The Republican-controlled Arizona House of Representatives took its first steps this week to lower the state’s corporate income tax rate in four successive years starting Jan. 1, 2026
House Bill 2003 would gradually decrease the current 4.9 percent business tax rate to only 2.5 percent. The bill sponsored by Rep. David Livingston was approved Wednesday by the House Ways & Means Committee and the House Appropriations Committee.
All of the Democrats on the two committees cast nay votes.
Arizona’s current corporate income tax rate in place since Tax Year 2017 is the greater of $50 or 4.9 percent of net income. Under HB 2003, that rate would drop to 4 percent for Tax Year 2023, then 3.5 percent the next year, and 3 percent the following year. For Tax Year 2026 and each year thereafter the rate would be only 2.5 percent.
Livingston (R-Peoria), who serves as chair of the House Appropriations Committee, said reducing Arizona’s corporate income tax (CIT) rate is a matter of fairness and sound tax policy.
“Cutting the corporate rate continues the state’s commitment to creating a low tax environment,” Livingston said after the two committee votes. “We’ve done great work to lower the rate on personal income and now we must take the next step to equalize our rate for C-Corps to make them even with other businesses who file via the personal income tax, such as S-Corps and partnerships.
The Joint Legislative Budget Committee (JLBC) advised lawmakers it is difficult to determine the revenue impact from the proposed change, due to the fact most corporations do not follow a calendar-year fiscal year. A final note issued by JBLC includes a “highly speculative” estimated impact on state coffers of nearly $1.7 billion.
But such estimates must be interpreted with caution at this time, according to JLBC.
“Finally, we would note that the estimates above do not reflect the potential behavioral response of taxpayers to the changes under the proposed CIT rate reduction,” the final note explained. “For example, all else equal, a reduction of corporate income taxes can serve as an incentive for businesses to invest in more capital and hire more labor than they would otherwise. Such ‘dynamic’ effects may result in an increase in economic output, which in turn may generate more tax revenue dollars for the state General Fund than what a ‘static’ analysis assumes.”
HB 2003 will move on to the House Committee of the Whole on a date to be announced.
The newly appointed head of the Arizona Department of Child Safety (DCS) wants to make child services interventions equitable.
Governor Katie Hobbs appointed Matthew Stewart last month following a ProPublica-NBC News report in December alleging that racial disparities plagued the DCS. The report featured Stewart as evidence of the alleged disparity issue.
According to the investigative report, DCS investigations increased for Black families while overall DCS investigations went down
Stewart worked at DCS for over a decade, first as a case manager then training supervisor. Stewart told reporters that he’d discovered the alleged racial disparity in 2018, but didn’t leave the agency for another two years. Afterwards, Stewart founded a nonprofit advocating for keeping families together, Our Sister Our Brother (OSOB). Their website ceased being public around the time of Stewart’s appointment. (An archive of the latest version of the website is available here). According to Stewart’s LinkedIn page, he no longer serves as the CEO of OSOB.
Just over a week before Hobbs appointed Stewart, his advocacy organization declared that the state needed to end interventions. In the hashtags, OSOB included references to “anti-racism education,” “anti-racism,” “racial justice,” “social justice advocacy,” “anti-racist,” and “diversity, equity, inclusion.”
“We need to move away from interventions. Communities need resources that are proactive rather than reactive,” stated OSOB.
The OSOB website, prior to being taken down, declared its “heightened focus” as undoing the “overrepresentation” of Black children in foster care. OSOB cited from nonprofit and DCS data that five percent of Arizona children are Black, yet they represent about 17 percent of the foster care population. Researchers estimated that approximately 63 percent of Black children will undergo a DCS investigation before they turn 18.
We have an intentional focus on supporting the Black community in Arizona and are committed to helping them realize Justice now.
In his interview with ProPublica-NBC News, Stewart said that DCS should focus more on solving “generational poverty and the resulting trauma” that was “centuries in the making.” Stewart expressed doubt that DCS could have a positive effect on lower-income Black families.
“I simply don’t think DCS is the agency to do this,” he stated.
Stewart said that DCS was part of a negative cultural fixation on Black families.
“We have a culture that says Black families need to be watched and if we don’t agree with the things that are going on with them, we are the saviors of these children and are charged with punishing their parents,” stated Stewart.
Stewart’s father, Warren Stewart, founded the oldest Black Baptist church in the Valley and instigated the state’s approval of Martin Luther King Jr. Day as an official state holiday.
The state created DCS in 2014 following systemic failures within Child Protective Services (CPS). In 2013, Hobbs, at the time a state senator and social worker, signaled support for prioritizing preventative measures rather than interventions. She said that CPS lacked employee support and infrastructure: namely, more funding to assist families that would prevent them from entering the system. Hobbs portrayed it as a cost-saving measure.
“We need to do so much more on the front end to help families on the front end who are struggling to stay out of the CPS system. What we could invest on that end is so much less than we would spend on the back end once people are in the system,” said Hobbs.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
A judge has been asked to put an end to a City of Phoenix ordinance which grants the NFL and the Arizona Super Bowl Host Committee authority over how and where residents and property owners can exercise their free speech rights before and after the Feb. 12 Super Bowl.
Although Super Bowl LVII is being played at Glendale’s State Farm Stadium, many of the NFL’s pregame festivities will be held in Phoenix. As a result, the Phoenix City Council quietly approved an ordinance establishing a nearly two-square-mile Special Promotional and Civic Event Area which encompasses most of downtown.
Anyone in the event area, also known as the “Clean Zone” is barred for the three weeks before the big game and one week after from displaying any temporary signage without the approval of the city as well as the NFL and the Arizona Super Bowl Host Committee.
The Goldwater Institute warned city officials weeks ago to put an end to the prohibitive ordinance or face legal action. There was hope the matter would be resolved Tuesday when council members met in a non-public Executive Session on Tuesday.
But when the ordinance was not repealed, the Goldwater Institute followed through on its pledge to defend those whose constitutional rights are being infringed by the ordinance. Its lawsuit filed Wednesday seeks an injunction blocking enforcement of the ordinance.
Phoenix resident Bramley Paulin is the plaintiff represented by the Goldwater Institute, while Mayor Kate Gallego and City Manager Jeff Barton are defendants in their official capacity along with the city as a municipal corporation.
“The Phoenix signage restrictions are just the latest instance in a disturbing, years-long nationwide trend of local governments forcing their own citizens to beg the NFL’s permission to speak freely. But Goldwater intends to stop this trend,” according to John Thorpe, an attorney for the Goldwater Institute.
Thorpe says Paulin, who is also a local business owner, has suffered firsthand the effects of city’s special deal with the NFL.
“While Bramley would like to lease his property for temporary signage placements, businesses won’t even talk to him because they’re afraid to do anything – even on private property, in compliance with all the regular city ordinances – without the express approval of the NFL.”
Thorpe argues that the signage restrictions violate the Arizona Constitution’s free speech protections while also flouting the Constitution’s due process of law guarantee by infringing on residents’ rights without providing any of the minimum procedural safeguards the Constitution requires.
“Moreover, the restrictions violate the Arizona Constitution’s principles of separation of powers, giving two unaccountable private entities—the NFL and the Arizona Super Bowl Host Committee—a blank check to wield government power against private citizens,” Thorpe says.
It is estimated the ordinance encroaches on the rights of hundreds of businesses and thousands of residents.
Paulin issued a statement after the lawsuit was filed on his behalf. He said it is not right that Phoenix city officials are letting the NFL decide what he can and cannot say on his own property.
“The government shouldn’t censor business owners like me, or any residents of the downtown area, when we communicate with the public—and it certainly shouldn’t let private companies decide what we can say,” Paulin said.
Terri Jo Neff is a reporter for AZ Free News. Follow her latest on Twitter, or send her news tips here.
Maricopa County may have to add its new branding to its growing list of controversies.
Critics of the county’s new brand remark that the letter “I” in Maricopa looks like a bright orange middle finger. It appears the design was intended to be a minimalist cactus.
Among the online critics was former State Senate President Karen Fann.
“Honestly, it looks like they are giving us the finger… again,” stated Fann.
even once you realize the symbol is meant to be a cactus, it doesn't read as an i – mar🌵copa in the less stylized form. my brain goes 'martcopa??' 'marycopa?'
The county unveiled the rebranding on Wednesday. In a press release, the county shared that the rebranding took over three years to produce, beginning several years before the pandemic. The rebranding will be uniform across all county departments and several elected offices. The county shared that it would also issue rebranding updates to other, unspecified areas throughout the year.
The county worked with the advertising and marketing agency HAPI to produce the branding.
The agency worked previously with Scottsdale Parks & Rec to create summer lifeguard help-wanted ad campaigns, and the city of Phoenix for general city advertising.
Board of Supervisors Chairman Clint Hickman justified rebranding due to reported resident confusion over distinguishing the county from other cities and towns due to similar, vague branding.
“What we found over a few years of research is that residents often confuse us with other governments or can’t distinguish between what the County provides and what their city or town handles,” said Hickman. “Some of this is the result of how we have presented ourselves over the years: as distinct departments instead of one unified County. That changes today.”
County Manager Joy Rich predicted that the new branding would improve employee recruitment and retention.
“A cohesive countywide identity means more people who need assistance will know where they can find it,” said Rich. “It will also help us recruit and retain the best workforce, which translates into better service for residents.”
The county also released a video to announce their rebranding. The narrator likened Arizonans and the county’s culture to the desert lands and, specifically, cacti.
“Our roots go deep and no matter what, we stand tall. Solving problems, removing barriers, growing a better future: we are Maricopa County, Arizona,” said the video.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
Attorney General Kris Mayes’ newly appointed right-hand man previously advocated for assault against the former attorney general.
Earlier this week, Mayes appointed lawyer Dan Barr to become her chief deputy attorney general. This comes a little under a year after Barr called former Attorney General Mark Brnovich a bully, indicating that physical force was the only means of handling him effectively.
“The only way to deal with cowardly bullies is to punch them in the nose,” wrote Barr. “That’s what @SecretaryHobbs is doing to @GeneralBrnovich.”
Barr issued the tweet in response to Governor Hobbs, then the secretary of state, suing Brnovich for threatening her with criminal action over her administration of the 2020 election.
He's right about one thing – the only way to stop a bully is to confront the bully head on (but not resort to violence as suggested by the "incoming" Chief Deputy, that would be assault & battery). pic.twitter.com/7HZ5f6pb89
The only way to deal with cowardly bullies is to punch them in the nose. That's what @SecretaryHobbs is doing to @GeneralBrnovich here. https://t.co/3MNZoiEe9F
Barr hails from Perkins Coie — the law firm formerly led by prominent Democratic Party and Russiagate attorney Marc Elias. He was representing Mayes in the case filed by her GOP opponent, Abraham Hamadeh, challenging this recent election. Barr filed a notice of withdrawal in the case on Monday.
Barr also represented Mayes in Hamadeh’s first lawsuit over the election results preceding the statewide canvass. Maricopa County Superior Court dismissed the case without prejudice for filing prematurely.
Barr told Arizona’s Law that he begins his role on Jan. 17. Jen Wright, former assistant attorney general and head of Brnovich’s Election Integrity Unit (EIU), questioned this timeline. She noted that he has an active email with the attorney general’s office.
If Barr hasn’t started conducting business on behalf of the AG, why would he have an AG email address? 🧐
Wright is contemplating a defamation lawsuit against Mayes after an unnamed source within the attorney general’s office falsely claimed to the Arizona Republic that Mayes fired Wright.
AZ Free News reached out to Barr about challenges to the timeline of his employment. We also asked if he had been or is currently working on any litigation with the attorney general’s office. He didn’t respond by press time.
Barr expressed confidence in Mayes’ ability to stop Saudi Arabia from using Arizona’s rural groundwater resources. Saudi Arabian companies rely on unlimited access to this water source for their commercial farms; unlike urban areas, groundwater in rural areas doesn’t have restrictions.
Barr is also supportive of Mayes’ approach to legalizing abortion. He expressed the belief that the “right to privacy” purportedly in the Constitution superseded the state’s interest in preserving unborn life. Prior to becoming a Supreme Court (SCOTUS) Justice, Louis Brandeis invented the “right to privacy” in the 1890s, later using it in key SCOTUS opinions. This language informed the landmark decision Griswold v. Connecticut — the precursor to Roe v. Wade, effectively creating a right to abortion and abolishing state bans on abortions.
“Mayes believes that Arizona's constitutional right to privacy supersedes Arizona's two restrictive abortion laws while Hamadeh believes that the pre-state law that bans most abortions and prosecutes doctors is Arizona's current law.” https://t.co/22LGqmrRyR
A proposition intended to provide transparency to certain, alleged dark money networks may result in more danger for certain nonprofits.
The Arizona Free Enterprise Club (AFEC) says it’s faced threats of violence and endured vandalism last year, and expressed concern that Prop 211, the Voters’ Right to Know Act, would exacerbate these issues.
AFEC President Scot Mussi told AZ Free News that some of the threats of intimidation were so severe that they filed police reports. Mussi said that the forced disclosure of the names, addresses, occupations, and identities of employers for any donors who gave over $5,000 to them would be subject to the same evils they face.
“Our supporters should be able to exercise their speech rights without fear of harassment or intimidation,” said Mussi.
Mussi predicted that Prop 211 would result in donors enduring retaliation and harassment. He pointed out that the proposition lacked substantive protections, except a provision protecting individuals from a “threat of physical harm.” However, Mussi was skeptical that the provision had any teeth for most organizations, save for the wealthy and powerful.
Our staff have received numerous phone calls/voicemails threatening violence. One staff member's car was even vandalized. Prop 211 only encourages this behavior – targeting, harassing & doxing conservatives who won’t submit to the Left’s agenda. https://t.co/dM0Z2xOV5Q
Any group or entity that spends over $50,000 on campaign media spending in a statewide race or $25,000 in any other race must adhere to those disclosure requirements. The top three donors for that cycle must also be disclosed, even if their funds weren’t used for campaign media spending.
Campaign media spending includes any public communications promoting, supporting, attacking, or opposing a candidate within six months of an election; referring to a candidate 90 days before a primary election; or even researching, designing, or producing content in preparation for public communication about a candidate. This expansive definition would include blog posts, articles, press releases, or social media posts.
Mussi told AZ Free News that the forced disclosure was tantamount to doxxing. He said the disclosures are a “well-known tactic” to silence dissent, referencing the ousting of Mozilla CEO Brendan Eich after he donated to fund a California initiative declaring that marriage belongs between a man and a woman.
As a result of these concerns, AFEC filed a lawsuit to overturn Prop 211 last month. The nonprofit insists that First Amendment free speech protections also afford the right to not be forced to speak.
Joining AFEC is the Center For Arizona Policy (CAP), a conservative nonprofit, represented by the Goldwater Institute. The named defendants include Governor Katie Hobbs in her former capacity as secretary of state, as well as the Arizona Clean Elections Commission.
In a press release, Goldwater Institute (GI) Senior Attorney Scott Day Freeman stated that Prop 211 would force donors to choose between supporting causes and organizations they believed in or having their donations and private information publicized on a government list.
“The result will be less free speech, more harassment, and an uglier political discourse,” stated Day Freeman.
As AZ Free News reported, Prop 211 provides neat carveouts for primary sources of leftist dark money: corporate media, Big Tech, labor unions, and “nonpartisan” PACs, for example.
The main financier of the measure, David Tedesco, is the founder and CEO of the Phoenix-based venture capitalist firm, Outlier. The leader of the effort was Terry Goddard, the state’s former Democratic attorney general. Both men toldThe Washington Post that they disagreed with characterizations of Prop 211 by AFEC, CAP, and GI.
Tedesco also pushed back against the Wall Street Journal editorial board opinion opposing the proposition.
“Transparency and sunshine are happy words, but in reality disclosure laws have become a weapon used by the left to intimidate conservatives from engaging in politics. Groups trawl records for names and then organize social-media campaigns to harass and discourage donors,” wrote the board. “Americans looking to participate in campaigns can, and often do, see their names dragged through the mud. Many donors decline to engage, and political speech is chilled before it even happens.”
Tedesco rebutted that Prop 211 doesn’t present a free speech threat because it was backed financially by registered independents and Republicans. He said that voters had a right to know any financial sources behind free speech.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
