Arizona Senate advances bill eliminating food tax, now heads to House

All 16 Republican senators voted in favor of Senate Bill 1063, eliminating food taxes in Arizona.
Published: Feb. 28, 2023 at 8:57 PM MST|Updated: Feb. 28, 2023 at 10:25 PM MST
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PHOENIX (3TV/CBS 5) - The Arizona Senate has advanced a bill that could save you money every time you go to the grocery store. But moving forward, the future of the bill is shaping up to be a major partisan fight.

All 16 Republican senators voted in favor of Senate Bill 1063, eliminating food taxes in Arizona. None of the Democratic senators voted for it. “We’re eliminating this tax on people so that they’ll have a little bit more money to put food on the table and gas in the tank of their car,” Senate President Warren Petersen (R) said.

Petersen says no food taxes could mean $50-100 a month of savings for Arizonans. So he was surprised that not a single Democrat voted in favor of Senate Bill 1063. “They have said that they want to help with inflation relief and provide relief,” he said. “So I think that’s a disappointment.” According to the Arizona League of Cities and Towns, 70 of the 91 cities and towns in our state currently have a food tax. Bigger cities like Phoenix and Tucson do not.

But League of Cities and Towns executive director Tom Belshe says these taxes are a big deal for smaller communities. “For some communities, that’s the only real retail item they have,” Belshe said. Belshe specifically pointed out Taylor, a town of a little over four thousand people in Navajo County, where the food tax is 35% of their general fund budget. “The city will have to find another way to make up that revenue,” he said. “It’s either going to be in the form of a higher property tax, it’s going to be in the form of a higher sales tax rate.”

Belshe suggests providing a one-time rebate to Arizonans to help them without getting rid of the tax. But Petersen says that’s not the best way to take advantage of a budget surplus. “Their arguments have basically been we need to take care of government. I wasn’t elected to take care of government,” Petersen said. “I was elected to take care of citizens and take care of people.”

Senate Bill 1063 now moves to the House. At Governor Katie Hobbs’ press conference today, she said she continues to be concerned about the impact getting rid of the food tax could have on cities and public safety budgets.

For a look at which cities have food taxes and what percentage those taxes are of their total revenue, here’s information from a previous Arizona’s Family story highlighting the bill.