Final month, the leaders of each Arizona state homes introduced committee assignments, setting the stage for subsequent yr’s legislative session after a bumpy yr out and in of session with COVID-19 interruptions.
One committee essential to enterprise and trade is the Senate Finance Committee, which is charged with making certain there’s sufficient cash to run the state, broaden or shrink applications as wanted, and craft laws associated to taxes and income.
Senator David Livingston (R-Peoria), lengthy an advocate for job creators, was named the brand new chair of the committee for subsequent session. Livingston, who at the moment serves as vice chair, spoke to Chamber Enterprise Information about what he foresees as priorities in 2021.
Livingston, whose private career in finance has centered round managing budgets, pensions and insurance coverage, stated he’ll proceed to work to make sure the Public Security Personnel Retirement System of the State of Arizona and the Arizona State Retirement System state pensions are funded and to draw insurance coverage firms and their excessive paying jobs to the state.
As Finance Chair, he’ll proceed to help payments that scale back authorities crimson tape and overregulation and create a pleasant surroundings for current companies and to draw new trade.
“As a conservative Republican, my priorities are all the time how can we scale back taxes and rules on the residents and companies of the state,” he stated.
Priorities for 2021 legislative session
A lot of the committee’s work subsequent yr will likely be revisiting payments that acquired pushed apart as a result of COVID-19 interruptions, Livingston stated. Whereas a lot will likely be “clear up” work, there are two main new challenges dealing with companies within the state.
Lawmakers will likely be looking for options on easy methods to offset hurt to employers from the 2 statewide propositions handed within the current election: Proposition 208, which instituted a serious state revenue tax enhance, and Proposition 207, which legalized leisure marijuana.
The Finance Committee was scheduled to start discussions on the 2 new legal guidelines Monday, however the assembly was cancelled as a result of a COVID-19 scare after legislators could have been uncovered to the virus when President Donald Trump’s private lawyer, Rudy Giuliani, met with them final week. Guiliani has since tested positive for the virus.
Mitigation for small companies damage by Proposition 208
As soon as they’re able to reconvene, the committee will focus on and solicit enter on what will be finished to reduce the affect on small companies from the revenue tax enhance proposition.
The brand new legislation nearly doubles the revenue tax on Arizona’s wealthiest residents to fund schooling. However in doing so, it additionally impacts tens of hundreds of companies. These are firms with 500 or fewer staff who file underneath the person tax code as pass-through entities, resembling sole-proprietorships, partnerships, LLCs, and S companies.
Many citizens have been unaware that small companies could be affected once they voted for the measure, enterprise advocacy teams stated. Now, information studies are already surfacing about firms leaving the state or rethinking plans to think about finding right here.
“I’ve had quite a lot of discussions with enterprise homeowners and chambers about how devastating Proposition 208 might be on our companies — our current companies and our skill to recruit companies to maneuver to Arizona,” Livingston stated. “So we’ve to discover a option to take care of Proposition 208. If meaning softening it, if meaning repealing it, if meaning going again to voters…”
Evaluation by quite a few economists like Elliott Pollack of Arizona State College’s Financial Outlook Heart and organizations just like the Arizona Tax Research Association and Goldwater Institute estimate that the proposition might end result within the lack of as much as 124,000 jobs and $2.4 billion in tax income over the following decade. New enterprise places to the state are estimated to drop by 15 %.
No less than two constitutional challenges to the measure have been filed in court docket. In the meantime, lawmakers are looking for methods to reduce the affect on small companies and preserve Arizona engaging to new funding if the legislation stands, Livingston stated.
“We’re having these discussions now and lots of people are working actually onerous at determining easy methods to take care of this. The way in which Proposition 208 is because it handed is unacceptable. It must be fastened and modified.”
Mitigating affect of Proposition 207 for employers
One other prime precedence within the upcoming session will likely be to take an in depth have a look at Proposition 207, which legalized grownup leisure use of marijuana for adults 21 and older, Livingston stated.
Employers are calling on legislators to seek out methods to guard the office and enterprise homeowners from authorized legal responsibility. They’re fearful about office errors, accidents and accidents and fewer productiveness on the job. Commerce organizations just like the Arizona Trucking Affiliation are involved about extra impaired drivers on Arizona roads.
Opponents stated it’s written in such a approach that employers may have issue taking opposed motion in opposition to staff.
The committee will likely be taking a look at methods to enhance the brand new legislation to assist shield employers in addition to present protections for customers, notably medical sufferers, who use the merchandise, Livingston stated.
The 17-page legislation is complicated for employers who want readability, he stated. Lawmakers additionally want readability on how the state will entry the gross sales tax the brand new legislation will generate.
“This isn’t my speciality, so I’m hoping somebody will take the lead on it. We want some common reforms so we will handle it higher, to not get rid of it as a result of the voters have spoken,” Livingston stated.