My legislation, that significantly simplifies the sales tax reporting system for Arizona businesses and employers, passed out of the House Ways and Means committee with unanimous support.
Arizona has the most complicated sales tax system in the entire nation. Currently businesses are required to fill out multiple tax forms, make payments to multiple jurisdictions, and be subjected to multiple audits from multiple cities and the state. My legislation will put Arizona in line with what 46 states already do and will free up valuable business time and money so businesses can concentrate on their work instead of filling out mountains of tax paperwork every month.
Last year Governor Brewer formed a sales tax simplification tax force to study ways to simplify
Arizona’s sales tax system. The Task Force met 17 times over six months in 2012. Tax experts from the state, cities, and Arizona’s small and large employers worked together to develop the recommendations that are now included in my legislation.
My legislation, HB2657, does three things:
1. It allows businesses to submit their city and state sales taxes in one on-line location instead of the multiple locations required under current law.
2. It limits business exposure to one single audit. Current law subjects businesses to multiple audits done by multiple cities and the state.
3. It replaces the current complicated prime-contracting tax system with one where the contractor simply pays sales tax on the materials at the point of sale. No longer will contractors have to fill out tax forms for every different city every month. This will save employers time and will also reduce the tax burden on the consumer.
The Governor and I continue to work with the cities to address some of their concerns. Cities are used to the status quo where cities collect their own taxes and do their own audits. Many cities are reluctant to relinquish their current authority.
My legislation is supported by the Governor and a huge and diverse coalition of Arizona businesses and employers. I am extremely pleased that my legislation has both Republican and Democrat support and passed out of the Ways and Means committee unanimously.
I am confident that my legislation will help Arizona’s economy by helping Arizona’s employers free up time and money to hire more workers.
I will do everything in my power to pass this legislation into law. It is the right thing to do.
Together, we can make a difference.
Arizona State Representative
Legislative District 21