Incentives and Taxes

Greater Phoenix was named the best large metro for business recruitment and attraction by Expansion Management magazine in 2007. With consistently decreasing tax rates, profitable incentives and an overall pro-business operating environment, there’s no better place to bring or start your business.

Incentives abound in Greater Phoenix

Businesses locating to Arizona can take advantage of a multitude of targeted incentive programs offered by the state.

Businesses in:

Enterprise zones are eligible for primary property tax reduction of 77% for five years.
Military reuse zones are eligible for total property tax reduction of 77% for five years.
Foreign trade zones are eligible for total property tax reductions of up to 77%.

Companies that participate in programs for job training, small businesses or commercial solar energy businesses also qualify for various tax credits. Additionally, GPEC will work with our partner communities to develop unique incentives for every situation.

For the past 11 years, businesses in Greater Phoenix have seen decreases in the average employer and individual tax rates. The individual tax rate in Arizona is currently 3.55%, compared to other Southwest markets, which range from 4.6% to 9.3%. Plus, the state does not levy the following taxes:

No corporate franchise tax
No business inventory tax
No income tax on dividends from out-of-state subsidiaries
No worldwide unitary tax
No sales tax on manufacturing equipment
Aggressive accelerated depreciation schedules
100% of net operating loss may be carried forward for 5 years

Greater Phoenix and Arizona offer a competitive operating-cost environment compared to California, Nevada, New Mexico and Texas. Recent pro-business measures include:

The Renewable Energy Tax Incentive Program that allows companies in the solar, wind, biofuels and geothermal industries to receive tax breaks for growing or expanding in Arizona.
A state property tax suspension (for three-years) providing over $200 million in annual relief for businesses and homeowners.
A reduction from 25% to 20% of the assessment ratio for real and personal property taxes on commercial and industrial properties over the next 10 years.
An angel investment tax credit allowing eligible tech-company investors a 30% credit on state taxes over a three-year period (biotech company investors can receive a 35% credit).

Contact GPEC

The Greater Phoenix Economic Council will happily uncover the best tax rates and incentives for your company, keeping the site selection process pain-free. For more information, contact us by email or by phone at 602.256.7700.