Governor Signs Tax Break Bill Limited to Just Two Industries

Apr 11, 2014

Gov. Jan Brewer is defending a $17 million tax break she signed today for two kind of businesses and only two kinds. Arizona Public Radio’s Howard Fischer explains.

Gov. Jan Brewer

The legislation says companies involved in manufacturing and smelting no longer have to pay the state sales tax on electricity and natural gas they purchase. But, virtually every other firm and individual remains subject to the 5.6 percent levy which generates about $500 million a year. Brewer said singling out manufacturing makes sense, calling it “smart tax reform that will bolster job creation in Arizona.”

“Until today, Arizona was one of only a handful of states that imposed this tax. Ending it removes one more barrier to business expansion and job creation. Eliminating this tax will boost our competitive edge in attracting and expanding manufacturing in our state,” Brewer said.

Steve Macias, president of Pivot Manufacturing praised the law even though he said it will save his company only a few hundred dollars a year. He said the key is increasing his sales.

“Almost all of that are to larger manufacturers, the General Dynamics of the world, guys who make equipment for the solar industry. So, when they attract those guys, I get excited because, to me, those are all potential customers,” Macias said.

And, Brewer said the hundreds of millions of dollars of tax breaks she has signed since becoming governor are part of her plan to restore the state’s economy — a plan she said is working.