The facts on Arizona’s Tax Climate

  • 4.54%
    individual income tax
    top rate
  • 6.968%
    corporate income tax
    flat rate
  • 6.6%
    sales tax
  • $1,119
    property tax
    collections per capita

Arizona’s Individual Income Tax System
Arizona’s personal income tax system consists of five brackets and a top rate of 4.54% kicking in at an income level of $150,000. That top rate ranks 41st highest among states levying an individual income tax. In 2009, Arizona’s state-level individual income tax collections were $379 per person, which ranked 41st highest nationally.
50-State Table of Individual Income Tax Rates

50-State Table of State Individual Income Tax Collections

50-State Table of State and Local Individual Income Tax Collections Per Capita

Tax Freedom Day Arrives on April 10 in Arizona

Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2012, Arizona taxpayers work until April 10 (ranked 35th nationally) to pay their total tax bill. The Tax Freedom Days of neighboring states are: California, April 20 (ranked 11th nationally); Nevada, April 18 (ranked 14th nationally); Utah, April 17 (ranked 17th nationally); Colorado, April 15 (ranked 21st nationally); and New Mexico, April 12 (ranked 28th nationally).


Arizona’s State and Local Tax Burden Below National Average

Arizona’s 2009 state and local tax burden of 8.7% of income is below the national average of 9.8%. Arizona’s tax burden has decreased overall from 10.3% (18th nationally) in 1977 to 8.7% (38th nationally) in 2009. Arizona taxpayers pay $3,140 per capita in state and local taxes.

Arizona’s State-Local Tax Burden, 1977-present
Other States’ State/Local Tax Burdens
Map of U.S. Showing all State’s Burdens and Ranks
Historical Chart Comparing All States’ State/Local Tax Burdens from 1977 to 2009

Arizona’s 2013 Business Tax Climate Index Ranks 25th

Arizona ranks 25th in the Tax Foundation’s State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes; individual income taxes; sales taxes; unemployment insurance taxes; and taxes on property, including residential and commercial property. The ranks of neighboring states are as follows: California (48th), Nevada (3rd), Utah (10th), Colorado (18th), and New Mexico (38th).

50-State Comparison of Business Tax Climates (data only)
2013 State Business Tax Climate Index (full study)