Reference Title: tax relief act of 1997

AN ACT
AMENDING SECTION 43-206, ARIZONA REVISED STATUTES, AS AMENDED BY LAWS 1995, FIRST SPECIAL SESSION, CHAPTER 9, SECTION 4; AMENDING SECTIONS 43-1011 AND 43-1043, ARIZONA REVISED STATUTES; RELATING TO INDIVIDUAL INCOME TAXATION.

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 43-206, Arizona Revised Statutes, as amended by Laws 1995, first special session, chapter 9, section 4, is amended to read:

43-206 . Urban revenue sharing fund; allocation; distribution

A. There is established an urban revenue sharing fund which shall, each fiscal year THROUGH FISCAL YEAR 1998-1999 , consist of an amount equivalent to fifteen per cent of the net proceeds of the state income taxes for the fiscal year two years prior to the current fiscal year. FOR FISCAL YEAR 1999-2000 AND EACH FISCAL YEAR THEREAFTER, THE URBAN REVENUE SHARING FUND SHALL CONSIST OF AN AMOUNT EQUIVALENT TO FIFTEEN AND EIGHT-TENTHS PER CENT OF THE NET PROCEEDS OF THE STATE INCOME TAXES FOR THE FISCAL YEAR TWO YEARS PRIOR TO THE CURRENT FISCAL YEAR. The fund shall be distributed to incorporated cities and towns as provided in this section.

B. Each city or town shall share in the urban revenue sharing fund in the proportion that the population of each bears to the population of all as determined by the United States bureau of the census in the last decennial census or special census pursuant to section 42-1341.01.

C. The treasurer, upon instruction from the department, shall transmit, no later than the tenth day of each month, to each city or town an amount equal to one-twelfth of that city's or town's total entitlement for the current fiscal year from the urban revenue sharing fund as determined by the department.

D. A newly incorporated city or town shall share in the urban revenue sharing fund beginning the first month of the first full fiscal year following incorporation.

Sec. 2. Section 43-1011, Arizona Revised Statutes, is amended to read:

43-1011 . Taxes and tax rates

There shall be levied, collected and paid for each taxable year upon the entire taxable income of every resident of this state and upon the entire taxable income of every nonresident which is derived from sources within this state taxes determined in the following manner:

1. In the case of a single person or a married person filing separately:

If taxable income is:	The tax is:
$0 - $10,000	3.0% 2.90% of taxable income
$10,001 - $25,000	$300 $290 , plus 3.5% 3.30% of the excess over
	$10,000
$25,001 - $50,000	$825 $785 , plus 4.2% 3.90% of the excess over
	$25,000
$50,001 - $150,000	$1,875 $1,760 , plus 5.2% 4.80% of the excess over
	$50,000
$150,001 and over	$7,075 $6,560 , plus 5.6% 5.17% of the excess over
	$150,000

2. In the case of a married couple filing a joint return or a single person who is a head of a household:

If taxable income is:	The tax is:
$0 - $20,000	3.0% 2.90% of taxable income
$20,001 - $50,000	$600 $580 , plus 3.5% 3.30% of the excess over
	$20,000
$50,001 - $100,000	$1,650 $1,570 , plus 4.2% 3.90% of the excess over
	$50,000
$100,001 - $300,000	$3,750 $3,520 , plus 5.2% 4.80% of the excess over
	$100,000
$300,001 and over	$14,150 $13,120 , plus 5.6% 5.17% of the excess
	over $300,000

Sec. 3. Section 43-1043, Arizona Revised Statutes, is amended to read:

43-1043 . Personal exemptions

There shall be allowed as an exemption, in the case of :

1. A single individual, a personal exemption of two thousand one hundred dollars . or, in the case of

2. A head of a household or a married individual, a personal exemption of four thousand two hundred dollars UNDER THIS PARAGRAPH . A husband and wife shall receive but one personal exemption of four thousand two hundred dollars. If the husband and wife make separate returns, the personal exemption may be taken by either or divided between them.

3. A MARRIED COUPLE FILING A JOINT RETURN AND CLAIMING AT LEAST ONE DEPENDENT, AN EXEMPTION OF SIX THOUSAND THREE HUNDRED DOLLARS. IF THE HUSBAND AND WIFE MAKE SEPARATE RETURNS, THE PERSONAL EXEMPTION MAY BE TAKEN BY EITHER OR DIVIDED BETWEEN THEM. AN EXEMPTION UNDER THIS PARAGRAPH IS IN LIEU OF THE EXEMPTION UNDER PARAGRAPH 2.

Sec. 4. Retroactivity; effective date

Sections 43-1011 and 43-1043, Arizona Revised Statutes, as amended by this act apply retroactively to taxable years beginning from and after December 31, 1996.

Sec. 5. Delayed effective date

Section 43-206, Arizona Revised Statutes, as amended by this act is effective from and after July 31, 1997.