The Arizona Secretary of State’s Office announced last week that enough valid signatures were turned in to let voters decide next year whether they support substantially reduced income tax rates set to take effect in 2022 or want to maintain the current higher rates.
But whether voters can actually weigh in on such issues in the November 2022 General Election is something the Arizona Supreme Court will likely be asked to decide.
In June, Gov. Doug Ducey signed an overhaul of Arizona’s income tax system as part of the $12.8 billion budget packet approved by the Legislature. It changes the state’s current five-tier income tax rates -from 2.59 percent up to a 4.5 percent base- to a two-tier plan with lower rates in 2022.
The legislation which created the new tax structure could even trigger a single 2.5 percent tax rate as soon as 2023 if Arizona’s revenues meet certain levels.
The flat tax system also addresses the impacts of Prop 208, which voters narrowly passed last year. Known as the Invest in Education Act, Prop 208 imposed an additional 3.5 percent tax surcharge effective 2021 on any income above $250,000 for a single filers or $500,000 for joint filers. The surcharge is on top of the current 4.5 percent base rate.
The revenue from the surcharge is slated to be used for public K-12 schools, but it does so by kicking Arizona’s highest earners to an 8 percent income tax. This put businesses in the state at a competitive disadvantage with Texas and Nevada which have no income tax, while New Mexico has a top rate of 4.9 percent.
Because the 3.5 percent Prop 208 surcharge was put into law by voters, state lawmakers could not directly undo it. Instead, the new flat tax rate plan would top out at 4.5 percent by absorbing the 3.5 percent surcharge.
However, supporters of Invest in Ed, now known as Invest in Arizona, want to void the new tax rate law despite the fact all Arizonans would share in the projected $1 billion savings. The group is trying to kill the flat rate plan by utilizing a provision of the Arizona Constitution which gives citizens 90 days after the legislative sessions ends to attempt to refer new state laws for voter approval.
Last week Invest in Arizona successfully submitted enough valid petition signatures to get the matter on the ballot next November as Proposition 307. In response to the petition drive, Ducey’s spokesman has continued to champion the new income tax structure, which would ultimately be the lowest flat tax in the country if state revenue targets are met.
“It keeps Arizona competitive,” said C.J. Karamargin. “We are returning tax dollars to the citizens of Arizona.”
Whether new laws dealing with state revenues such as income taxes are eligible for voter referendum has never been ruled on by a state court.
A lawsuit by the Arizona Free Enterprise Club argues that the Arizona Constitution actually prohibits issues related to the support and maintenance of state government to be referred to the ballot. A decision by Judge Katherine Cooper of the Maricopa County Superior Court is expected any day.
Whichever side loses in Cooper’s court is expected to appeal, with the Arizona Supreme Court expected to hear the case eventually.
Another wrinkle in the tax saga is that the Arizona Supreme Court ruled earlier this year that Prop 208 can be challenged on the basis of the state’s constitutional spending limits for K-12 schools. The justices recently sent the matter back to the Maricopa County Superior Court for additional arguments although the case is expected to be back at the Arizona Supreme Court early next year.
On Tuesday, the Democrats in the Arizona House of Representatives attempted to prevent a vote on an election integrity bill, and then when that failed, Rep. Athena Salman called for a boycott of the state if the bill passed.
Earlier in the day, Democrat lawmakers refused to show up to work in order to prevent a quorum as part of their effort to block a vote on SB1485.
Later, in a vote along party lines, Sen. Michelle Ugenti-Rita’s bill passed and is now headed back to the Senate.
SB1485 would remove people from the Early Voting List (EV), who don’t return their mail ballot for two consecutive election cycles from the permanent list, which allows voters to automatically receive a ballot before each election.
Not everyone shared Salman’s view. Sen. TJ Shope, a moderate Republican, tweeted his support for the bill:
I look forward to supporting SB1485 in the Senate. It’s NOT unreasonable to send a notice to a PEVL voter after NOT voting in FOUR consecutive elections and confirming their intent to remain on PEVL. The hyperbole surrounding this bill is disgusting & offensive to POC like myself https://t.co/tLTfGLYtyM
Sen. Salman and the Arizona House Democrats continue to make discredited statements about SB1485, including allegations that the bill would “purge” the early voting list and “infringe” on voting rights.
The reason the bill heads back to the Senate is that it was amended to win the support of more Republican lawmakers in the House.
The amendment softened the bill, according to experts.
Before the amendments, a person could be removed from EVL after not using an early ballot in two consecutive primaries and general elections. Under the amendments, a person would have to miss all elections within a two-year period including city or other minor elections, to be dropped from the EVL.
In all cases, voters remain registered to vote. They are simply dropped from the list of mail-in ballot recipients.
Representative Paul Gosar (R-AZ-04) claims that the media fabricated his involvement in an “America First Caucus.” A document purportedly linked to the proposed caucus was released over the weekend, causing controversy over certain aspects of its outlined objectives.
One of those objectives was to uphold and preserve Anglo-Saxon political traditions.
Gosar issued a press release afterward clarifying that he didn’t author the document, but would continue to work on “America First” issues within an already-existent caucus, the House Freedom Caucus:
The liberal media have recklessly claimed I am the author of a document. Let me be perfectly clear, I did not author this paper. In fact, I first became aware of it by reading about it in the news yesterday, like everyone else. Imagine my surprise to read I ‘wrote it.’ I will continue to work on America First issues in the House Freedom Caucus. Once again, I am the subject of a false media story. I will not let the lying media deter me from the America First work I have been championing for years in the House Freedom Caucus and with President Trump.
Gosar’s Chief of Staff, Tom Van Flein denied to reporters that Gosar ever attempted to form a new caucus. Representative Marjorie Taylor Greene (R-GA-14) was also identified as a chief leader in creating the America First Caucus.
The claims that Gosar and Greene were leading this caucus came from Punchbowl News, a newer political news site launched earlier this year by longtime Politico reporters. They published a document purportedly from representatives putting together the America First Caucus.
“A new American First Caucus – led by @mtgreenee and @RepGosar – is recruiting people to join based on ‘Anglo-Saxon political traditions’ architectural style that ‘befits the progeny of European architecture[,]’” wrote Punchbowl News. “Some of the most nativist stuff we’ve seen.”
A new America First Caucus — led by @mtgreenee and @RepGosar — is recruiting people to join based on “Anglo-Saxon political traditions” architectural style that “befits the progeny of European architecture”
Critics immediately likened the aspects of the document referencing Anglo-Saxon traditions with white nationalism and racism.
It is unclear how Punchbowl News obtained the document.
Following the backlash over the document outlining the caucus focuses, Greene abandoned efforts to pull it together. She stated that the document was a draft proposal by another group, which she hadn’t read prior to Punchbowl News publishing it.
“On Friday, sick and evil POS in the media attacked me with phrases I never said or wrote. They released a staff level draft proposal from an outside group that I hadn’t read,” wrote Greene. “The scum and liars in the media are calling me a racist by taking something out of context.”
On Friday, sick and evil POS in the media attacked me with phrases I never said or wrote.
They released a staff level draft proposal from an outside group that I hadn’t read.
The scum and liars in the media are calling me a racist by taking something out of context.