(Disclosure: Rose Law Group represents Ann Siner of My Sister’s Closet and Judge John Buttrick in their litigation efforts against Prop 208.)
By Erin Edgemon | Phoenix Business Journal
A Maricopa County Superior Court judge on Friday struck down Proposition 208, a tax on Arizona’s highest-earning residents that was approved by voters in 2020.
Judge John Hannah ruled that the law passed to boost education spending can’t be enforced because of a state Supreme Court ruling last year that stated Prop 208 is unconstitutional if the money it brings in for education surpasses limits set by the Education Expenditure Clause of the Arizona Constitution, according to an Associated Press report.
The tax increase, which was named the Invest in Ed initiative, was passed by 52% of Arizonans in November 2020 as a way to raise money for schools, particularly for teacher salaries.
Gov. Doug Ducey, an opponent of Prop 208, issued a statement after Friday’s ruling.
“This ruling is a win for Arizona taxpayers. It’s another step in undoing the damage of Prop 208 and making sure we continue to benefit from having the lowest flat income tax rate in the nation,” he stated.
“While we expect the ruling may be appealed, we are confident the Arizona Supreme Court will find 208 unconstitutional, as they did last year,” Ducey added. “Arizona is – and will remain – a state that knows how to prioritize education while keeping taxes low and attracting jobs.”
Prop 208 would have affected Arizona taxpayers who earn at least $250,000 a year as individual filers or at least $500,000 per year as joint filers. That’s about 3% of Arizona’s filers, one economist told the Business Journal after the measure passed.
Prop 208 had been estimated to raise $827 million a year, but state lawmakers made changes to the state’s tax law that effectively cut that estimate by up to $378 million, or 45%, according to the Arizona Republic.
“The Maricopa County Superior Court John Hannah has wiped out Prop 208 ruling that the money from the Prop 208 tax can’t be spent without exceeding the aggregate expenditure limit for schools and that it violates the Arizona Constitution.” – Jordan Rose, Founder of Rose Law Group
