ARIZONA STATE SENATE
Fifty-Fourth Legislature, Second Regular Session
model city tax code; procedures
Outlines a process for the Municipal Tax Code Commission (Commission) to hold meetings for the adoption of amendments to the Arizona Model City Tax Code (MCTC).
The MCTC is a uniform sales and use tax act that has been adopted by most Arizona cities and towns as the basis for imposing tax. The MCTC facilitates tax base uniformity among cities and towns and authorizes cities and towns to either exempt or tax certain items that are not part of the standard or model language of the code (JLBC 2019 Tax Handbook).
A city or town must submit any proposed modification or amendment of the MCTC to the Commission for review and recommendation. The Commission must review and comment on language submitted by any city, town, taxpayer or the Arizona Department of Revenue (ADOR) for the purpose of describing, defining, deleting, adding or otherwise modifying taxable activities, exemptions, administrative procedures or regulations relating to the MCTC. The Commission may hold public hearings within 30 days after receiving a proposed amendment or modification, to review and receive comments on the proposed changes. All changes to the MCTC must be reflected in the official copy on file with ADOR within 10 days of approval by the Commission. If changes are not reflected in the official copy of the MCTC on file with ADOR, they are void and of no effect. Changes to the MCTC approved by the Commission must be adopted by all cities and towns. A city or town may not adopt a modification or amendment to any provision of the MCTC that the Commission has not already approved. The MCTC is maintained by ADOR and an official copy is on their website (A.R.S. § 42-6053).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
1. Replaces the process to review and comment on proposed changes to the MCTC with new procedures for the Commission to adopt changes to the MCTC.
2. Requires the Commission to meet in response to a proposed amendment.
3. Requires a city or town, a taxpayer or ADOR, at least 60 days before the Commission adopts any amendment, to submit the proposed amendment to the Commission to review and consider for adoption.
4. Requires the Commission to hold an informational public hearing, at the request of a city or town, a taxpayer or ADOR, to review and receive comments on a proposed amendment at least 30 days after receiving the amendment.
5. Requires ADOR to provide a legal analysis of the proposed amendment to the Commission at the informational public hearing, if an information public hearing was requested.
6. Requires ADOR to post the proposed amendment with any required changes on ADOR's official website no later than five days after the informational public hearing.
7. Requires the Commission, at least 60 days after receiving a proposed amendment, to hold a public hearing to consider any information and testimony presented at the informational public hearing, if one was requested, and to consider adopting the proposed amendment.
8. Requires ADOR to update the official copy of the MCTC, if the Commission adopts the proposed amendment, within 10 days.
9. Requires ADOR to post a proposed amendment, meeting notice and meeting agenda on their official website at least 30 days before the informational public hearing, and at least 60 days before the public hearing for consideration to adopt the proposed amendment.
10. Removes the requirement for the Commission to meet monthly and requires, rather than allows, the Commission to meet on the call of the chairman.
11. Prohibits a city or town from adopting an amendment of the MCTC unless it has been adopted, rather than approved, by the Commission.
12. Removes the requirement for the Commission to give a two-week notice for a meeting.
13. Voids any changes to the MCTC that are not reflected in the official copy posted on ADOR's official website, rather than on file with the ADOR.
14. Makes technical and conforming changes.
15. Becomes effective on the general effective date.
Amendments Adopted by Committee of the Whole
1. Specifies that an informational public hearing for a proposed amendment to the MCTC will only be held at the request of a city or town, a taxpayer or ADOR.
2. Makes conforming changes.
FIN 2/05/20 DP 8-0-2
Prepared by Senate Research
February 19, 2020