by Matthew Holloway | Jan 13, 2026 | Economy, News
By Matthew Holloway |
Republican legislative leaders in Arizona introduced a tax conformity plan on last week, aimed at aligning the state’s tax code with recent federal tax reforms. The proposal, outlined in a joint press release from the Arizona State Legislature, estimates roughly $1.1 billion in tax savings for Arizonans over the next three years.
Senate Finance Committee Chairman J.D. Mesnard (R-LD13) and House Ways & Means Committee Chairman Justin Olson (R-LD25) are sponsoring the plan through two bills: SB 1106 and HB 2153.
According to the release, Republican lawmakers say the conformity effort will provide certainty to taxpayers and tax preparers amid the current filing season. They state the proposal would adjust Arizona’s tax code to reflect provisions of the federal tax overhaul known as the “One Big Beautiful Bill.”
The Republican plan would include measures such as increasing the child tax credit and establishing a deduction for childcare expenses. It would also aim to apply the federal tax reforms to Arizona’s individual and business tax structures.
“This is an urgent matter. With tax season underway, tax professionals and families alike need clear guidance now,” Senate President Warren Petersen said. “Until the Legislature acts and the Governor signs this plan into law, there is real confusion about how to handle state tax returns. We’re urging Governor Hobbs to join us in resolving this issue promptly by signing this historic tax cut when it hits her desk.”
House Speaker Steve Montenegro (R-LD29) is quoted in the release, asserting that formal legislative action is needed to resolve confusion created by recent state tax guidance issued by the governor’s office, which he says assumes legislative action has already occurred.
Montenegro explained, “The Governor jumped ahead of the law by issuing state tax guidance this week that assumes legislative action – which hasn’t happened yet – and her recent executive order only deepens confusion. This kind of unilateral overreach undermines the process and leaves families, tax preparers, and businesses stuck in the middle.”
He added, “The Legislature is moving to restore certainty, respect the separation of powers, and make sure Arizonans have clear, lawful guidance.”
The press release states that Republican sponsors contend the plan’s focus is on working families, seniors on fixed incomes, and small businesses, and that it would codify measures such as preventing taxation of tips and overtime pay.
SB 1106 and HB 2153 are set to be debated in the Legislature as the session begins.
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
by Jonathan Eberle | Dec 17, 2025 | News
By Jonathan Eberle |
Arizona Senate Republicans released their 2026 Majority Plan on Monday, outlining policy priorities aimed at reducing the cost of living, strengthening public safety, supporting economic growth, and increasing oversight of state government.
The plan follows several years of divided government at the Capitol and builds on what Republicans describe as recent legislative accomplishments, including balanced budgets and multiple tax cuts passed without raising overall taxes. Caucus leaders say the 2026 agenda is intended to address challenges facing Arizona families, particularly rising housing costs, inflation, and concerns about government accountability.
“Arizonans want affordable living, safe neighborhoods, and a government that strengthens — not weakens — our economy,” Senate President Warren Petersen said in a statement. “While the Governor’s vetoes stall progress, Senate Republicans remain focused on protecting taxpayers, upholding Arizona’s freedoms, and preventing the radical left from turning our state into California.”
A central component of the plan is a proposed tax and budget framework aimed at providing relief from rising prices. Senate Republicans say they are pursuing reductions in state taxes on tips and overtime, expanded deductions for seniors, and policies to support small businesses. Caucus leaders estimate the proposals would return more than $1 billion to taxpayers over three years while pairing tax relief with restrained government spending.
Housing affordability is another major focus. The plan cites regulatory barriers, slow permitting processes, and executive-level actions as factors contributing to Arizona’s housing shortage. Republicans say they support reforms to speed up construction, reduce fees, and limit local restrictions on new housing, while aligning development decisions with water availability data.
“Arizonans can’t afford policies that stall development, inflate housing prices, or jeopardize our water security,” Senate President Pro Tempore T.J. Shope said. “Senate Republicans are advancing practical, data-driven solutions that support responsible growth and keep Arizona livable for the next generation.”
Water policy is addressed alongside housing, particularly as negotiations over the Colorado River continue. The plan emphasizes the Legislature’s statutory role in those talks and calls for shared conservation efforts among basin states to avoid placing disproportionate burdens on Arizona.
Public safety proposals include addressing staffing shortages in correctional facilities, increasing oversight of state agencies, and strengthening accountability for violent offenders and probation violators. The plan also reiterates support for Second Amendment protections and public safety pension stability.
Senate Majority Leader John Kavanagh criticized the current administration’s record, saying, “Arizonans deserve leadership that solves problems, not a wolf in sheep’s clothing who blocks solutions and hopes voters won’t notice.”
Additional priorities outlined in the plan include border security enforcement, election integrity measures, education policy, transportation and infrastructure investment, emergency preparedness, artificial intelligence safeguards, family court reform, veterans’ services, and oversight of agencies such as AHCCCS and the Department of Child Safety. Opening day of the second regular session of the 57th Legislature is scheduled for January 12, when many of the proposals are expected to be introduced.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Jonathan Eberle | Nov 23, 2025 | News
By Jonathan Eberle |
A new dispute erupted at the Arizona State Capitol on Thursday after Senator J.D. Mesnard (R-LD13), chair of the Senate Committee on Finance, accused Governor Katie Hobbs of misleading the public with an executive order tied to federal tax changes enacted earlier this year.
In a press release, Mesnard said Hobbs’ order directing the Arizona Department of Revenue to update state tax forms “blatantly misleads the public” by implying that her administration was delivering new tax relief. According to Mesnard, the changes she referenced were already established under H.R. 1, a federal tax reform package advanced by former President Donald Trump and congressional Republicans.
Hobbs’ order, he argued, does not create any new state-level reductions. “Middle-class families deserve honesty, not last-minute attempts to steal credit for others’ hard work,” Mesnard said, asserting that Hobbs was attempting to claim political ownership of reforms she opposed. He noted that Democrats in Congress uniformly voted against the federal tax package and that—despite the governor’s framing—the adjustments she cited are already federal law.
Mesnard also criticized the order on procedural grounds, calling it inappropriate for a governor to “direct” the Department of Revenue’s handling of state tax policy. He said such authority rests with the Legislature.
The senator added that Republicans plan to advance legislation next session to formally align Arizona’s tax code with the federal reforms and expand on them where possible. But he warned that Hobbs’ order could create “uncertainty and chaos” for taxpayers in the meantime.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Ethan Faverino | Jul 8, 2025 | Economy, News
By Ethan Faverino |
President Donald Trump’s One Big Beautiful Bill, supported by all Arizona’s Republican representatives, was signed on Friday, July 4th. The bill provides the largest tax relief in American history.
Among the bill’s most impactful provisions are no tax on tips, no tax on overtime, and no tax on Social Security benefits.
These policies are designed to put more money back into the pockets of the hard-working American people.
The “No Tax on Tips” provision offers a new deduction of up to $25,000 for workers in tipped industries. Whether tips are received in cash, by charge, or through tip-sharing arrangements, employees will keep more of their hard-earned income.
This measure is expected to save tipped workers nearly $2,000 annually, providing direct financial relief to millions of Americans in these critical industries.
The bill also eliminates taxes on overtime pay. This guarantees that workers who put in extra hours are rewarded greatly with bigger paychecks. This, as well, could also save Americans on average $2,000 a year.
According to a new study from the Council of Economic Advisers, 88% (48 million) of American seniors receiving Social Security will pay no taxes on their Social Security income.
For a single senior receiving the average retirement of $24,000 annually, deductions will exceed their taxable Social Security income. Similarly, married seniors with a combined Social Security income of $48,000 will also see their deductions surpass taxable income.
The One Big Beautiful Bill also delivers an average 15% tax cut for Americans earning between $15,000 and $80,000, significantly boosting take-home pay.
For a typical family with two children, this translates to an increase of up to $10,900 per year in after-tax income. The bill also boosts the standard tax deduction, raising it to $23,625 for married couples and $15,750 for singles, a benefit utilized by 91% of taxpayers.
According to the Council of Economic Advisers, the One Big Beautiful Bill will drive significant growth and fiscal stability. This includes:
- Real wages increasing by up to $7,200 per year
- Real Investment growing by as much as 10%
- Creation of protection of 7 million jobs
- Deficit reduction of up to $11.1 trillion, driven by $5.2 trillion from economic growth, $2.8 trillion from tariff revenue, $1.6 trillion from discretionary spending cuts, and $1.5 trillion from interest savings.
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
by Daniel Stefanski | Feb 5, 2025 | Economy, News
By Daniel Stefanski |
A bill to keep unwelcome tax increases away from unsuspecting Arizona taxpayers cleared its first body of the state legislature.
On Monday, the Arizona Senate passed SB 1013 with a 17-12 vote. One Democrat member of the chamber, Senator Burch, did not vote. All Senate Republicans voted to approve the legislation, while all Democrats in attendance voted in opposition.
If passed by the Arizona Legislature and signed into law, the bill would “prohibit the common council of a municipality or the board of supervisors of a county from increasing an assessment, tax or fee without a two-thirds vote of the governing body.”
In a statement accompanying the news of the Senate vote, President Warren Petersen, the sponsor of the bill, said, “I’ve received a number of concerns and complaints from Arizonans who are frustrated with recent hikes on taxes and fees, especially in this era of inflation. We want government to be more efficient with taxpayer dollars, and this is a step in the right direction. This commonsense taxpayer protection requires the same threshold from local governments as the Legislature when raising or imposing fees. We want to make sure government fully funds its obligations, but we also want to protect our citizens from unnecessary taxation.”
Last month, the proposal cleared the Senate Government Committee with a 4-3 vote. All Republicans voted in favor of the bill, while all Democrats registered votes in opposition in committee.
On the Arizona Legislature’s Request to Speak system, representatives from the Republican Liberty Caucus of Arizona, Barry Goldwater Institute for Public Policy Research, Arizona Free Enterprise Club, Arizona Chamber of Commerce, National Federation of Independent Business, Republican Liberty Caucus of Arizona, and Home Builders Association of Central Arizona, signed in to support the bill. Representatives from the Arizona Municipal Water Users Association, City of Casa Grande, Sierra Club – Grand Canyon Chapter, City of Bisbee, Coconino County, the Arizona Center for Economic Progress, League of Arizona Cities and Towns, City of Tucson, signed in to oppose the legislation.
SB 1013 now makes its way to the Arizona House of Representatives for consideration. If passed by the state House, it would then make its way to the Governor’s Office for its fate. Governor Katie Hobbs, a Democrat, would likely veto the bill.
Daniel Stefanski is a reporter for AZ Free News. You can send him news tips using this link.
