PHOENIX — The Republican nominee for Arizona governor, U.S. Rep. Andy Biggs, says the state needs to get rid of its income tax to stay competitive.
Biggs says Arizona must eliminate its state income tax to attract companies – and jobs – over other Sun Belt states with no tax, like Texas, Tennessee and Florida.
He told ABC15 he doesn’t plan to do away with income taxes entirely next year if he’s elected, saying wants to start with gradual reductions.
Do you have a concern in your community or a news tip? We want to hear from you!
Connect with us: share@abc15.com
“We're not going to do it overnight,” Biggs said. “We're going to be smart. We're going to be incremental, but we need to compete with these other states.”
Biggs said cutting income taxes could lead to more revenue because Arizona will be able to recruit businesses to Arizona.
“And you will see economic activity come, and you'll see a growth in state revenue, which is the norm when you when you reduce the statute taxes,” he said.
When ABC15 asked Gov. Katie Hobbs about his proposal earlier this month, she said she didn’t want to talk about “a hypothetical,” adding that she has cut taxes as governor.
“I've signed budgets, negotiated and signed budgets, every year that cut taxes for Arizonans every single year, including this year with a $1.4 billion tax cut,” she said. “That is putting money back in the pockets of Arizonans.”
The tax-cut package in this year’s state budget slashes $1.4 billion in taxes over three years, one of the largest cuts in Arizona history.
They are primarily made up of state versions of the cuts from President Donald Trump’s One Big Beautiful Bill Act, such as a larger standard deduction, deductions for tips and overtime and tax breaks for businesses.
Replacing income tax with sales tax?
Hobbs' campaign and Democratic groups have taken aim at Biggs’ proposal to eliminate the state’s income tax, pointing to his longtime support for replacing the federal income tax with a national sales tax of 23%. They say such a “European-style tax” would raise everyday costs.
“From tariffs to health care cuts to his 23 percent sales tax, Andy Biggs keeps finding new ways to make life more difficult and more expensive for Arizona families,” state Sen. Flavio Bravo said.
The Fair Tax Act has little support in Congress, and it’s unlikely to become law. It would eliminate the Internal Revenue Service and do away with federal taxes in favor of a national sales tax. Taxpayers would also receive a monthly rebate based on federal poverty levels.
The 23% sales tax would be inclusive – meaning it would be calculated based on both the purchase price and the tax.
According to Biggs’ campaign, the proposal would result in a net reduction in taxes for taxpayers.
Senior advisor Drew Sexton said Hobbs has spent her political career trying to raise taxes.
“From her push to double the state gas tax to vetoing the No Tax on Tips and Overtime bill three different times, she’s done nothing but make life more expensive for Arizonans,” he said. “Voters know Andy Biggs has worked for pro-growth tax reform in his time as Senate President and in Congress and they’re ready to see him eliminate the state income tax as their next Governor.”
Want more news in your community? Add ABC15 as a preferred source on Google below:
