The City of Scottsdale is once again attempting to impose an illegal sales tax on its residents—and the Goldwater Institute is again taking the city to court to enforce the state Constitution and to defend taxpayers against the city’s overreach.
On Friday, the Goldwater Institute filed suit against Scottsdale for moving forward with an unconstitutional sales tax increase that was approved by less than 60 percent of voters in the November 2024 election. That tax is expected to collect $1.14 billion over 30 years, with collection beginning July 1. Under the state Constitution, such a tax increase must be approved by 60 percent of voters—and therefore, Scottsdale’s sales tax does not meet the legal threshold required to take effect.
This isn’t the first time Scottsdale has attempted to foist this illegal tax on residents. Last year, the Scottsdale City Council approved a sales tax increase to add funding to parks, the McDowell Sonoran Preserve, Westworld, and other city services. Because the city decided to submit its new tax to the people as a referendum before it could become law, Scottsdale officials placed the tax on the ballot in the November 2024 general election—but they provided a misleading description of the tax, intending to fool voters into thinking it was a tax-reducing measure, when in reality it was a tax increase. The Goldwater Institute sued, and won—forcing the city to admit that it was raising, rather than lowering taxes. The city complied with that court ruling, which allowed them to put the tax on the November ballot. But despite not garnering 60 percent of the vote, city leaders have decided to move forward with the tax anyway.
But this case is about more than this one tax. It’s about protecting the principle that governments shouldn’t raise taxes without broad public support.
Taxes aren’t just abstract numbers—they represent the government taking your time, effort, and creativity. Obviously, the government may legitimately tax people to provide public services such as police protection and infrastructure—but used unwisely, taxes can punish, manipulate, and even—as Chief Justice Marshall warned more than two centuries ago—destroy. That’s why since at least the days of the American Revolution, with its slogan of “no taxation without representation,” our country has imposed stringent limits on government’s taxing powers.
In fact, Arizonans have enacted some especially important taxpayer-protections. In 1992, they amended the state Constitution to require that tax increases be approved not just by a bare legislative majority, but by a two-thirds supermajority. And in 2022, Arizonans strengthened those protections by amending the Constitution to require any tax passed through a citizen initiative or referendum receive at least 60 percent approval to become law—a requirement that applies not just to statewide, but also to local ballot initiatives.
Unfortunately, government officials often try to weasel their way around these limits—which is why the Goldwater Institute has been at the forefront of enforcing legal protections for taxpayers. We’ve sued state, county, and city governments to enforce legal limits on the taxing power, saving Arizonans hundreds of millions of dollars in the process.
Supermajority rules help protect minority voices, prevent special-interest-driven decisions, and force governments to clean up their budgets before reaching for more of your money. Just like any responsible household, city, county, and state officials should look at how they’re spending first—not just always demand more, regardless of what the law and economic commonsense demand.
Yet Scottsdale is ignoring the state’s constitutional mandate—requiring us to go to court yet again.
Scottsdale’s tax move is bad policy. But worse: it’s unconstitutional. You can learn more about how we’re fighting to make sure the law—and taxpayer rights—are enforced by clicking here.
You can read our complaint here and read more about the case here.
Scott Day Freeman is a Senior Attorney at the Goldwater Institute.
