Arizona Gov. Doug Ducey has approved a plan that phases out 20% annual increases to a corporate tax credit that funds private school scholarships.
The bill signed by the Republican governor on Thursday scales back the growth over four years. After that, the maximum credit would go up by 2% or the inflation rate each year.
The tax credit funds so-called School Tuition Organizations that distribute the corporate cash they receive to private school students.
The program started at $10 million in 2008 and now allows corporations to divert more than $100 million yearly to the school organizations and get credit toward their income taxes. Under the bill, the maximum value of tax credits in 2024 would drop from about $220 million to $145 million.
