Did Arizonans Get A Tax Cut And Schools Get A Funding Cut?

Did Arizonans Get A Tax Cut And Schools Get A Funding Cut?

By Jose Borrajero |

As one of the longest legislative sessions in Arizona history comes to a close, we come to the customary conclusion that no one is totally happy with the results. That is to be expected. No individual or group of individuals should expect to get all they want.

However, this session fell considerably short of conservative goals in several areas. Most prominent among these were election integrity and balance of power. Balloting irregularities and dictatorial executives are anathema to good governance.

Still, we did not do so badly considering the current composition of our legislature. Hopefully, that composition may be improved during the next election cycle.

Two areas in which we did better than many had expected were the budget and tax reform. But these are precisely the two areas in which we are getting tremendous pushback from organizations that support unionism, socialism, and radicalism (please excuse the redundancy).

One major radical group is Save Our Schools Arizona. They are already calling for a citizen’s initiative to undermine the hard-earned progress we made in the areas of budgeting and taxation.

In fact, Save Our Schools AZ, in their June 28 Legislative Report made the following outrageous, irresponsible, and patently false statements:

“The Bad: House lawmakers passed a K-12 budget bill packed with myriad attacks on schools and teachers.” And…

“The Brutally Awful: Both the House and Senate passed identical bills pushing Arizona’s largest tax cut in history into law”.

Let us evaluate the second claim first. It should be pointed out that whenever these radical organizations bitch and moan about “tax cuts” they are bitching and moaning about “tax cuts for the rich”. They don’t bitch and moan about the portion of the tax relief that helps low- and middle-class taxpayers. With that in mind let us look at the overall taxation of the rich, to determine whether this is a giveaway to the wealthiest among us, or simply a much-needed tax relief to prevent job providers from fleeing Arizona.

Marginal income tax rate paid by the wealthiest Arizonans:

Before Prop 208 4.5%
After Prop 208 8.0% (4.5% + 3.5%)
After Tax Relief 6.0% (2.5% + 3.5%)

Can someone, with a straight face, explain how going from a 4.5% tax rate to a 6.0% tax rate constitute a “tax cut”? Tax relief would be a much better name for it.

It should also be noted that there is nothing in the omnibus tax relief tax relief bill (SB1828), or in any of the budget reconciliation bills to remotely suggest that the Education industry will not get their 3.5%. This brings us to addressing the other claim made by the Save Our Schools cabal.

The only way that a thinking person can agree with the SOS’s claim that the legislature gave us a “K-12 budget bill packed with myriad attacks on schools and teachers” is to conclude that a whopping 24% increase in funding constitutes “myriad attacks”. Let us look at some numbers taken from the JLBC’s and the Governor’s websites:

FISCAL YEAR TOTAL BUDGET EDUCATION BUDGET
2021 $11.5 BILLION $6.7 BILLION ($5.0 B K-12 + $1.7 B HIGHER ED)
2022 $12.8 BILLION $8.2 BILLION ($6.2 b K-12 + $2.0 B HIGHER ED)

While the overall budget went up by a relatively modest 11%, the education budget increased by 22%, and the K-12 portion increased by 24%.

Under this new budget, the portion allocated to education is 64%, leaving only 36% for healthcare, law enforcement, border security, street repairs, infrastructure, etc.

The SOS and other groups that claim to support students should be praising our legislature and thanking them for their generosity, instead of plotting to undermine their work via mob rule.

Our View: Arizona Taxpayers Need Much-Deserved Relief

Our View: Arizona Taxpayers Need Much-Deserved Relief

By Doug Ducey, Karen Fann & Rusty Bowers |

President Ronald Reagan once said, “You can’t be for big government, big taxes, and big bureaucracy and still be for the little guy.”

Well, in Arizona, we are fighting for the little guy. We’re reducing the size of government, slashing regulations and cutting taxes.

The pandemic left no one in America untouched, but today, Arizona is open for business and our economy is thriving.

During the pandemic, many Americans from ultra-liberal states that embraced lockdowns relocated to Arizona so their kids could still go to school in person and their small businesses could survive. Hundreds of companies are moving or expanding here. And when these companies relocate to Arizona, they’re bringing high-paying jobs.

There’s a reason that Arizona has become a beacon of economic prosperity. People and companies are tired of burdensome overregulation and high taxes, and they’re moving their operations to a place that embraces free enterprise.

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Arizonans Need To Call Rep. David Cook And Demand Tax Relief

Arizonans Need To Call Rep. David Cook And Demand Tax Relief

By Catherine Barrett |

David Cook is a Republican politician elected to serve in the Arizona House of Representatives from the 8th Legislative District. Representative Cook was elected to the State House in 2016 and represents central and eastern Pinal County and southern Gila County. He currently is in opposition to tax reform.

When alerted that a postcard campaign was taking place on Wednesday the 16th to encourage him to listen to the stories of hardworking Arizonans that need tax relief he did provide the following social media tweets (@RepDavidCook), “ …Yes – “we” the people- not any one person, one party, one county- “We the people” of Arizona.  Those of us that are truly conservatives – saving the taxpayers – Billions (or trying to) and paying off those debts – not kicking them down the road – for future generations.”  A public school teacher then asked, for him to support the flat income tax rate.  Now, more than ever we need tax relief. He replied, “How much are your HOA fees a year?” The response, “Respectfully, we don’t have HOA fees, we have Biden penalties.”  Silence

Arizonans need to call Representative David Cook (LD8) 602-926-5162 and voice your stories about how hardworking citizens need tax relief. Tax relief is any government program or policy initiative that is designed to reduce the amount of taxes paid by individuals or businesses. This is the time to return money to taxpayers, not leave it in the hands of the government.

Catherine Barrett, an Arizona Master Teacher, has been called “the bravest teacher advocate in the state” by educators and lawmakers. She holds Masters degree in Education and had been teaching for 19 years.

Are Republican Proposed Tax Cuts Too Much?

Are Republican Proposed Tax Cuts Too Much?

By the Free Enterprise Club |

Republicans in the Arizona legislature are on the cusp of passing significant tax relief for hardworking families and small business. With historic levels of surplus cash sitting in the state coffers (over $4 billion for FY 2022 alone), returning this money to taxpayers makes sense. In fact, it would have already happened if not for two lone holdouts within the Republican caucus, claiming the $1.9B tax cut is just “too big.”

Are they right? Should the size of the tax package be reduced to avoid a funding cliff in the future?

For an answer to this criticism, it makes sense to examine current revenue projections being provided by the Joint Legislative Budget Committee (JLBC). For years JLBC has been relied upon as an independent source for revenue and budget projections by the state legislature. JLBC has never been accused of partisanship or of “cooking the books” to produce rosy budget scenarios. If anything, they have historically been too conservative in their figures, often because they don’t use dynamic modeling for their growth projections.

With this in mind, JLBC is projecting that by FY2024, baseline revenue for the state will be over $14.5 billion, a figure that has been growing with each month. For perspective, legislators were budgeting just shy of $11.1 billion in ongoing revenue prior to the pandemic—meaning that Arizona is expected to see a 31% increase in state revenue in four years.

Where is all this new revenue coming from? While a portion of this surplus is expected from economic growth, that is not the only source. Much of this new revenue is from a series of tax increases that continued to be ignored by opponents of the budget.

Remember the “monumental” new gaming compact Ducey signed in April—the one allowing for sports and fantasy sports betting? That is projected to rake in $300 million of new revenue annually by FY2024.

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Arizonans Need To Call Rep. David Cook And Demand Tax Relief

Congress Can’t Use COVID Relief To Stop State Tax Cuts

By the Goldwater Institute |

With states still feeling the economic damage done by the COVID-19 pandemic, President Joe Biden signed the “American Rescue Plan Act” to give states billions of federal dollars to help them recover. But there’s a catch: The Act effectively prohibits states that take the money from cutting taxes through 2024. That’s unconstitutional—and the Goldwater Institute is joining one legal challenge to it.

Congress can sometimes put conditions on grants to states, but it can’t take advantage of an emergency to coerce states into giving up control of such an important issue of state policy, and it can’t impose a condition on a grant that has nothing to do with the grant’s purpose. That’s why many state attorneys general have filed federal lawsuits challenging this “Tax Mandate”—and it’s why the Goldwater Institute has filed a brief supporting the state of Ohio’s challenge.

THE TAX MANDATE

provision in the Act says that states cannot use federal grant money to “directly or indirectly offset” a loss of revenue resulting from a tax cut enacted between March 2021 and the end of 2024. If they do, the U.S. Secretary of the Treasury will take the federal money back, up to the amount of revenue the state lost. That appears to mean that states that cut taxes between now and 2024 will have to pay back some or all their grant money.

The Tax Mandate’s defenders say this is just to make sure states actually use federal money for COVID relief. But the Tax Mandate doesn’t actually do that. The Act lists four broad categories of things a state can spend federal grant money on. After states spend the money, they have to report how they spent it to the Treasury Secretary. If the Secretary determines that a state spent money on something that doesn’t fall into one of those categories, she can take that money back.

So if a state receives a grant of, say, $5 billion, it has to show that it spent $5 billion on things the Act allows. If some things it reports weren’t appropriate uses of the money, the Secretary can recoup that portion of the grant. That alone ensures that states spend their federal grants for the purposes Congress intended.

The Tax Mandate, on the other hand, does not help ensure that states spend their grant money properly. Instead, it focuses on whether a state indirectly used federal funds to offset revenue lost as a result of tax cuts. That might make sense if the Act were otherwise designed to deny federal money to states that could afford to pay for their own COVID relief (if they put other policy priorities aside). But the Act doesn’t do that.

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