HB 2918
Initials VP Page 1 Ways & Means
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature
First Regular Session
HB 2918: tax rates; reductions
Sponsor: Representative Olson, LD 10
Committee on Ways & Means
Overview
Modifies the formula to calculate the truth in taxation rates for equalization assistance,
lowers the tax rate to 4.93% for specified transaction privilege tax (TPT) classifications and
the income tax rate to 2.47% for individuals, estates and trusts and small businesses.
History
Each year, on or before February 15, the joint legislative budget committee (JLBC) is
required to compute the truth in taxation rates for equalization assistance. The computation
is done by following a formula outlined in statute. (A.R.S. § 41-1276)
The tax rate for the following transaction privilege classifications is 5%: 1) transporting; 2)
utilities; 3) telecommunications; 4) pipeline; 5) private car line; 6) publication; 7) job printing;
8) prime contracting; 9) amusement; 10) restaurant; 11) personal property rental; and 12)
retail (A.R.S. § 42-5010).
The income tax rate for individuals, estates and trusts and small businesses is 2.5%. (A.R.S.
§§ 43-1011, 43-1311 and 43-1711)
Provisions
1. Modifies the formula to calculate the truth in taxation rates by reducing the result of the
current formula by 1.205% for 2025. (Sec. 1)
2. Reduces the tax rate for specified TPT classifications to 4.93%. (Sec. 2)
3. Reduces the income tax rate for individuals, estates and trusts and small businesses to
2.47% beginning January 1, 2026. (Sec. 3)
4. Makes technical and conforming changes. (Sec. 1, 2, 3)
☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal Note