Arizona Gov. Katie Hobbs vetoes grocery tax ban, signs 9 bills into law

PHOENIX — Arizona Gov. Katie Hobbs vetoed two bills Tuesday, including one to ban local grocery taxes, and signed nine others into law.

The Republican sponsor of the grocery tax legislation called the Democratic governor’s move “disgraceful.”

In her veto letter for SB1063, Hobbs said preventing cities from taxing groceries would potentially force them to cut services.

She also noted it wouldn’t provide relief from inflation anytime soon because it wouldn’t go into effect until June 30, 2025.

“What’s more, it does nothing for the more than 800,000 Arizonans who use SNAP and WIC benefits for their groceries, as these constituents are already exempt from the tax,” she wrote.

I have vetoed SB1063. I’ve heard from dozens of local leaders about the impact this legislation would have on municipalities. 🧵

— Governor Katie Hobbs (@GovernorHobbs) March 28, 2023

“Let’s work together to provide real relief for Arizonans struggling with higher costs.”

The bill was introduced by Sen. Sonny Borelli (R-Lake Havasu City) and passed through the Legislature on party lines. Republicans hold a one-seat advantage in each chamber.

“This veto is a disgraceful windfall for cities and an absolute gouge for families,” Borelli said in a press release. “We’re not only paying inflated prices to feed our families, but we’re also paying more in taxes as the cost of food rises.

“Food is not a luxury; it is a necessity. A tax on our groceries is regressive and hurts everyone.”

Borelli, the Senate majority leader, said cities can do without the grocery tax proceeds because they are due to receive a significant increase in state-shared revenues over the next four years.

“And yet the governor vetoed this bill, only padding cities’ bloated budgets instead of leaving more money in the wallets of hardworking taxpayers,” he said.

Last month, Hobbs vetoed a Republican bill that would have eliminated taxes for rent payments.

The League of Arizona Cities and Towns opposed both tax bills. Tom Belshe, the group’s director, told KTAR News 92.3 FM’s The Mike Broomhead Show in February that there already are 5.7 million Arizonans who don’t pay rental taxes and 3.2 million who don’t pay grocery taxes.

“When you take into account that you’re getting rid of those taxes and you’re actually not helping all Arizonans, we think there are better ways to help,” he said.

Hobbs on Tuesday also vetoed SB1096, a Republican bill which would have required government contracts for more than $100,000 to include certification that the company doesn’t and won’t “discriminate against a firearm entity or firearm trade association.”

The governor signed the following bills, all of which the Legislature passed unanimously:

• SB1036 Setting Aside Conviction; Cert. Eligibility
• SB1051 Census Adjustment; Population Threshold
• SB1078 Podiatric Medical Assistants; Radiation; exemption
• SB1173 Public Retirement Systems; Plan Election
• SB1190 Department of Revenue; Administration
• SB1211 County Attorney; Representation; Duties
• SB1218 Naturopathic Physicians Medical Board
• SB1283 Dental Board; Annual Report; Website
• SB1473 Tax Corrections Act of 2023

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