Several Phoenix-area cities use tiered sales tax rates so that higher end purchases such as automobiles are taxed at a lower rate.
ByJoshua Bowling |Arizona Republic
The Pinal County Regional Transportation Authority may have to return $72 million to business owners after the Arizona Supreme Court struck down a 4-year-old tax. The ruling raised questions about whether metro Phoenix city sales taxes would need to change.
The short answer appears to be no.
At issue in Pinal County was a tax that voters approved in 2017 to bring in an estimated $640 million over 20 years for transportation projects in the growing area southeast of Phoenix. The rub: purchases over $10,000 were exempted from the half-cent sale tax.
The Goldwater Institute, which represented a resident, business owner and the Arizona Restaurant Association in the lawsuit against the county and the Arizona Department of Revenue, argued the tax unfairly burdened low-income residents and business owners who don’t sell big-ticket items.
The court’s 4-3 ruling did not take up those issues of fairness. The court majority ruled that state law does not allow counties to create tiered taxing systems in the way cities and towns are allowed to do.
