Tax Reform Means Jobs for Arizonans
You’ve probably heard lawmakers exclaiming that their priorities are “jobs, jobs and jobs”. No matter what the issue of the day happens to be, leaders on both sides of the aisle will say the focus must be on jobs and the economy. But I don’t blame some of the more cynical parts of the electorate to question whether those words ever turn into action. What are Arizona leaders doing to create jobs and bring back this economy? I would point to an announcement on August 14 as evidence Republicans are making the right decisions in public policy and re-establishing Arizona as a leader in the national recovery.
That day the Intel Corporation announced it will start building a $300 million research and development facility in Chandler. The company says that facility will create several hundred well-paying jobs. This is on top of the massive construction project well-underway on the Chandler Intel campus. The Fab 42 manufacturing facility will be completed next year, and the company says it will hire one thousand people for that plant.
Clearly these are exciting numbers to see as we climb out of the economic downturn. A private company is pouring billions of dollars into an expansion of its already-large operations in our state. These decisions weren’t made in a vacuum. We can point to specific decisions made by Republicans in the Senate and House, along with the Governor, that led to these positive economic developments.
Last year, the Governor called a special session to enact the Arizona Competiveness Package. Within this sweeping tax reform and business incentive plan were many items that a company such as Intel would look at when considering an expansion in Arizona.
We lowered the state’s tax rate for commercial property from 20% to 18%, a tremendous reduction for a $300 million facility. The corporate income tax is being phased down from almost 7% to 4.9% by 2016, becoming the fifth-lowest rate in the country. We raised the sales factor from 80% to 100%, meaning a company such as Intel that sells products around the world will have a much bigger reason to stay and expand in our state.
The Arizona Competiveness Package also included a Quality Jobs Program, providing a tax credit of $3,000 per new employee. We improved upon this in our last legislative session, lifting a 400 employee cap on the credit, so that a company such as Intel will benefit from the credit for the 500+ new employees it hires.
I don’t pretend to claim that legislation passed into law was the only reason for Intel’s expansion in Chandler. What I do know is the Majority in the Legislature laid the groundwork for companies large and small to flourish. It’s crystal clear that Arizona is now a business-friendly state, and we all benefit from an outstanding company investing, expanding and hiring here. My hope is that this announcement is just the start.
Sen. Steve Yarbrough Chairman, Senate Finance Committee