Arizona Gov. Katie Hobbs vetoes bill that would eliminate taxes for rent payments

PHOENIX — Arizona Gov. Katie Hobbs on Thursday vetoed a bill that would have eliminated taxes for rent payments, citing a pair of reasons for her decision.

Hobbs, a Democrat, said in a letter to Republican Senate President Warren Peterson that she was unsure SB 1184 would actually provide relief for renters.

“If we are going to promise relief for renters, it’s important that we are able to ensure they actually receive it,” Hobbs said.

“For working families faced with ever-increasing rental prices, this proposal just doesn’t fit the bill.”

She also argued that the bill, which included an appropriation of roughly $270 million over 18 months, wasn’t appropriate outside of a budget agreement.

Proponents of eliminating the tax said consumers deserve the break while inflation is high and state and local governments are financially strong.

Opponents worried the lost revenues would force small rural communities to cut funding from their public safety budget.

Tom Belshe, director of the League of Arizona Cities and Towns, wasn’t in favor of the bill.

“I don’t want to make light of inflation, but this is a temporary problem. When you make a permanent solution like cutting taxes, you create issues,” Belshe said earlier this month on KTAR News 92.3 FM’s The Mike Broomhead Show.

Hobbs said she is committed to finding a solution that is a better fit.

“I appreciate the Legislature’s interest in addressing rising housing costs, particularly for renters,” Hobbs said.

“Lowering costs for Arizona families is a priority of my administration.”

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