Incentives
Arizona’s Operating Environment Provides Rich Incentives
The aerospace and defense industry receives unwavering political and social support in Arizona, fostering a pro-business environment rich with state incentives, a globally competitive cost structure, tax reductions and favorable fiscal legislation for businesses.
Governor Brewer’s recently enacted Arizona Competitiveness Package represents another major effort in the state’s initiative to provide greater incentives and a more appealing economic environment for businesses. The Arizona Technology Council says the plan “embraces high-technology industries as the engine that will drive our state for the next 30 years.” Specific aspects of the plan include the creation of a quality jobs program, with corporate tax credits of up to $9,000 for each qualifying new job and an increase in the electable state corporate income-tax sales factor to 100 percent.
Incentives and Programs
- Military Reuse Zone (MRZ) programs – allows for transaction privilege tax exemption, tax credits and property reclassification, providing some of the lowest effective tax rates in the United States.
- Foreign Trade Zone – allows qualifying companies to have real and personal property taxes assessed at 5 percent of full cash value (instead of 23 percent), resulting in a 78 percent abatement.
- Enterprise Zone program – enhances opportunities for private investment. A company located in an enterprise zone may receive tax credits by creating new quality jobs as well as property tax reclassification that can reduce a business’ property tax bill by approximately 40 to 60 percent.
- Arizona Job Training grants – a job-specific reimbursable grant program that supports the design and delivery of customized training plans for employers creating new jobs or increasing the skill and wage levels of current employees – considered one of the best workforce training grant programs in the nation.
- Federal and State Technology Partnership program – education and grant programs that help technology entrepreneurs commercialize their technology.
- Personal Property (machinery, equipment or other personal property) Tax Exemption – personal property used in manufacturing or other commercial operations is exempt from transaction privilege tax.
- Sales Factor – gives multistate corporations the option of choosing either an 80 percent sales factor or a double-weighted sales factor apportionment method to compute Arizona taxable income.
- Additional Depreciation – encourages new capital investment and reduces personal property tax liability.
- Research and Development Income Tax Credit – awards-qualified research and development conducted in Arizona.
- Small Business Capital Investment Tax Credit program (Angel Tax Credit) – expands early-stage investments in targeted Arizona small businesses by providing tax credits to investors who make capital investments in small businesses certified by the Arizona Department of Commerce.
- Commercial/Industrial Solar Energy Tax Credit program – provides an Arizona income tax credit for the installation of solar energy devices in Arizona business facilities.
Contact Commerce for Assistance
Our team of experts provides full-service, statewide assistance to help your business effectively use incentives and programs that benefit your business. Commerce offers solutions that help businesses create strategic partnerships, expand, relocate and recruit a qualified workforce.
