The effect of HB2818 is expected to standardize and potentially increase enforcement actions taken by the Arizona Department of Revenue. By streamlining penalty structures, the bill aims to discourage late filings and noncompliance among taxpayers. The preemptive nature of the penalties may lead to enhanced revenue collection for the state, but could also create a burden for taxpayers who encounter genuine difficulties in timely filing or payment.
Summary
House Bill 2818 amends Section 42-1125 of the Arizona Revised Statutes, focusing on civil penalties in tax administration. The bill significantly increases the penalties for taxpayers who fail to file or pay their taxes on time. The initial penalty for failing to make and file a return is set at four and one-half percent of the tax due for each month of delay, capping at a total of twenty-five percent maximum penalty. Additionally, specific further penalties are introduced for failures to furnish required information or for filing a frivolous return.
Contention
Notable points of contention surrounding the legislation include concerns from taxpayer advocacy groups over the fairness of imposing such stringent penalties, especially for those who may have reasonable causes for late filings. Opponents of the bill argue that these higher penalties disproportionately affect lower-income taxpayers and those operating small businesses, leading to increased financial strain and discouragement in administrative compliance.
Increases tax rates on certain tobacco products to be on par with tax rate imposed on cigarettes under cigarette tax; dedicates revenue for smoking and tobacco use cessation programs.
An Act Concerning The Interest Paid By The State On Overpayments Of Taxes, Various Changes To Tax Credit Programs Available Under The Insurance Premiums Tax And The Corporation Business Tax, Exemptions From The Petroleum Products Gross Receipts Tax, And A Study Of The Structure Of The Personal Income Tax.
Imposes a tax on selected nicotine products, including, but not limited to a nicotine pouch or products intended to be made into a nicotine pouch by the consumer; defines a nicotine pouch as a smokeless pre-portioned pouch containing nicotine but no tobacco, which the user puts and leaves between their lip and gum while the nicotine and taste is being released; makes related provisions and technical amendments.