Republican legislative
leadership and the governor have justified shameful cuts to education and social
safety net programs by claiming they were balancing the budget.

The governor recently signed
a law that will increase income tax deductions from certain, specialized
business investments from $25,000 to $500,000 a year. This could cost the state
another $31 million that wasn’t accounted for in the so-called balanced
budget.
The Joint Legislative Budget
Committee (JLBC), the Legislature’s budget office, shows that this law will
leave Arizona’s budget structurally imbalanced for years to come. Here is a full
analysis from JLBC.
Although education and social
services will have to suffer more cuts, the Republican budget did fund new
private prison beds, while protecting and expanding more than $3
billion in corporate and special interest tax cuts. Here is a list of some of the new tax cuts Republicans supported
this year.
(HB 2001 - Income Tax Brackets; Inflation.) Since then, the legislature
passed and Governor Ducey has signed into law more tax cuts that will reduce revenues beyond
what was assumed in the budget plan.
These tax cuts include:
• SB 1188 - IRS Conformity - increases the income tax deduction for certain business
expenses from $25,000 to $500,000 at a cost of $31 million a year.
• HB 2670 - International Operations Centers - reduces revenues by $1.3 million a year and
gives a tax break to Apple for their new operation center.
• HB 2128 - Leased Religious Property - reduces property taxes for religious organizations
that use leased property for worship. The $2.1 million in reduced property taxes means
the state's K-12 education budget will make up the difference.
• HB 2568 - Insurance Premium Tax Reduction - gradually reduces the premium tax rate for
some types of insurance from 2% to 0.3% over ten years. Starting with a $1.3 million
impact in FY 17, this legislation is projected to cost $35.2 million when fully phased in.
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