After hours of contentious debate and a clearing of rowdy teachers and activists in the gallery, Arizona House Republicans took the final steps to get Gov. Doug Ducey a budget.
The $13 billion spending plans includes the largest income tax cut in state history. Should Ducey sign it, the state’s four-tier income tax would eventually flatten to 2.5%, a lower rate than the lowest current tier. It would also cap the state’s top income tax percentage that could be paid to 4.5%, meaning high-earners and businesses whose income triggers Prop. 208’s 3.5% surcharge would pay only an additional 1% into state coffers. The majority of the tax savings would go to high-earning taxpayers because they pay the near-majority of taxes, but an analysis from Ducey’s office shows the median income family would save approximately $300.
