Arizona businesses may be in store for a bigger break on their personal property taxes. A proposal making its way through the Legislature would drastically increase the state's business personal property tax exemption.
House Concurrent Resolution 2031 won preliminary approval in the House. If approved by the House and Senate, it will go before voters in November.
If voters approve, the measure will immediately raise the current personal property tax exemption to $2.4 million. It also allows lawmakers to increase the exemption even more in the future without seeking voter approval.
Sponsor of HCR 2031, Representative J.D. Mesnard, said the change would be good for the economy. "If you want folks to be investing and buying and whatnot, we should increase the exemption," he said.
Critics say the main problem with the multi-million dollar exemption is the fact that cities and counties rely on the tax revenue. So if taxes are reduced in one place, the funds will have to be made up elsewhere, likely with higher tax rates on real property.
In 2012, a similar proposal (Proposition 116) sought to raise the business personal property tax exemption to $2.4 million. However, it was defeated by voters.