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ARIZONA STATE SENATE
Fifty-Fifth Legislature, First Regular Session
AMENDED
corporate income tax; phase-out
(NOW: corporate income tax; subtraction)
Purpose
Requires, for taxable years beginning January 1, 2022, a corporation's first $100,000 of Arizona gross income to be subtracted from Arizona gross income when computing a corporation's Arizona taxable income.
Background
The corporate income tax is levied on corporations that engage in business within Arizona. Arizona gross income for a corporation is the same as the corporation's federal taxable income for the taxable year. Current statute authorizes various amounts to be added or subtracted when computing a corporation's Arizona taxable income (A.R.S. §§ 43-1101; 43-1121; and 43-1122).
The Joint Legislative Budget Committee fiscal note estimates that S.B. 1252 would result in a state General Fund revenue loss of $(32.2) million, beginning in FY 2023. The fiscal note states that the estimate is uncertain due to data limitations (JLBC fiscal note).
Provisions
1. Requires, for taxable years beginning January 1, 2022, a corporation's first $100,000 of Arizona gross income to be subtracted from Arizona gross income when computing a corporation's Arizona taxable income.
2. Becomes effective on the general effective date.
Amendments Adopted by Committee
· Adopted the strike-everything amendment.
Senate Action
FIN 2/10/21 DPA/SE 5-4-1
Prepared by Senate Research
February 24, 2021
MG/gs