Phoenix, AZ– Lawmakers in Arizona took the initiative to implement a tax ban to tackle the increasing housing expenses.
Arizona tenants could see some financial relief in the upcoming year as the state plans to eliminate the transaction privilege tax on rental properties.
Beginning January 1, property owners will be required to cease the collection of the residential rental tax. Starting at the beginning of the new year, TPT licenses with the Arizona Department of Revenue that exclusively feature the residential rental code will face automatic cancellation.
The tax rate shows minor differences across Arizona’s municipalities, indicating that tenants may experience different levels of relief based on their rental location.
The residential rental tax rate in Phoenix was established at 2.3%, in contrast to Mesa’s rate, which was set at 2%. The levy is imposed on residential properties rented out for 30 or more consecutive days.
The Arizona Department of Revenue has announced that property owners must continue to register their rental properties with the county assessor to adhere to landlord-tenant regulations.
Lawmakers from the Republican party took the lead on implementing the tax ban to tackle the increasing housing expenses in Arizona. However, numerous local governments were concerned that abolishing the tax would jeopardize a crucial funding stream for their budgets.
Governor Katie Hobbs first turned down the suggested tax repeal, arguing that it failed to ensure a financial advantage for renters. Hobbs subsequently approved the removal of the tax.