Arizona HB 2639: TPT; exemption; qualifying equipment; extension

Bill Text

HB2639 - 572R - I Ver 

 REFERENCE TITLE: TPT; luxury item classification

 State of Arizona

 House of Representatives

 Fifty-seventh Legislature

 Second Regular Session

 2026

 HB 2639

 Introduced by 

 Representatives 
 Sandoval: Abeytia, Aguilar, Austin, Connolly, Contreras L, Garcia, Liguori, 
 Luna-N�jera, M�rquez, Peshlakai, Simacek, Stahl Hamilton, Tsosie, Villegas

AN 
ACT

Amending sections 42-5010, 42-5010.01, 
42-5029 and 42-5061, Arizona Revised Statutes; amending Title 42, chapter 5, 
article 2, Arizona Revised Statutes, by adding section 42-5077; relating to 
transaction privilege and use tax. 

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Section 42-5010, Arizona Revised 
Statutes, is amended to read:

START_STATUTE42-5010. Rates; distribution base

A. The tax imposed by this article is levied and 
shall be collected at the following rates:

1. Five percent of the tax base as computed for the 
business of every person engaging or continuing in this state in the following 
business classifications described in article 2 of this chapter:

(a) Transporting classification.

(b) Utilities classification.

(c) Telecommunications classification.

(d) Pipeline classification.

(e) Private car line classification.

(f) Publication classification.

(g) Job printing classification.

(h) Prime contracting classification.

(i) Amusement classification.

(j) Restaurant classification.

(k) Personal property rental classification.

(l) Retail classification and amounts equal to 
retail transaction privilege tax due pursuant to section 42-5008.01.

2. Five and one-half percent of the tax base 
as computed for the business of every person engaging or continuing in this 
state in:

(a) The transient lodging classification described 
in section 42-5070.

(b) The online lodging marketplace classification 
described in section 42-5076 who has entered into an agreement with the 
department to register for, or has otherwise obtained from the department, a 
license to collect tax pursuant to section 42-5005, subsection L.

3. Three and one-eighth percent of the tax 
base as computed for the business of every person engaging or continuing in 
this state in the mining classification described in section 42-5072.

4. Zero percent of the tax base as computed for the 
business of every person engaging or continuing in this state in the commercial 
lease classification described in section 42-5069.

5. Six and one-half percent of 
the tax base as computed for the business of every person engaging or 
continuing in this state in the luxury item classification.

B. Except as provided by subsections J and K of this 
section, twenty percent of the tax revenues collected at the rate prescribed by 
subsection A, paragraph 1 of this section from persons on account of engaging 
in business under the business classifications listed in subsection A, 
paragraph 1, subdivisions (a) through (h) of this section is designated as 
distribution base for the purposes of section 42-5029.

C. Except as provided by subsection K of this 
section, forty percent of the tax revenues collected at the rate prescribed by 
subsection A, paragraph 1 of this section from persons on account of engaging 
in business under the business classifications listed in subsection A, 
paragraph 1, subdivisions (i) through (l) of this section is designated as 
distribution base for the purposes of section 42-5029.

D. Thirty-two percent of the tax revenues 
collected from persons on account of engaging in business under the business 
classification listed in subsection A, paragraph 3 of this section is 
designated as distribution base for the purposes of section 42-5029.

E. Fifty-three and one-third percent of 
the tax revenues collected from persons on account of engaging in business 
under the business classification listed in subsection A, paragraph 4 of this 
section is designated as distribution base for the purposes of section 42-5029.

F. Fifty percent of the tax revenues collected from 
persons on account of engaging in business under the business classification 
listed in subsection A, paragraph 2 of this section is designated as 
distribution base for the purposes of section 42-5029.

G. In addition to the rates prescribed by subsection 
A of this section, if approved by the qualified electors voting at a statewide 
general election, an additional rate increment is imposed and shall be 
collected through June 30, 2021. The taxpayer shall pay taxes 
pursuant to this subsection at the same time and in the same manner as under 
subsection A of this section. The department shall separately 
account for the revenues collected with respect to the rates imposed pursuant 
to this subsection and the state treasurer shall distribute all of those 
revenues in the manner prescribed by section 42-5029, subsection E.� The 
rates imposed pursuant to this subsection shall not be considered local 
revenues