- Associated Press - Wednesday, February 12, 2014

PHOENIX (AP) - An Arizona legislator is setting aside his proposal for an overhaul of the state income tax.

Republican Rep. J.D. Mesnard of Chandler prefers a one-rate “flat tax” approach but had settled on a proposal to collapse the state’s five tax brackets into three while not raising anyone’s taxes and maintaining state revenue.

However, Mesnard said he no longer plans to introduce the three-bracket legislation during the current regular session, the Arizona Capitol Times (https://bit.ly/LUzwwy ) reported.

Mesnard said he believes that differing projections on the possible impact on state revenue would raise too many questions from fellow lawmakers. The state gets more than a third of its revenue from income tax.

Mesnard said he’s proceeding with legislation to implement other recommendations of an interim advisory task force on the state income tax.

Those other recommendations include additions and subtractions to Arizona’s calculation of gross revenue, adjustments to income tax deductions available to businesses purchasing certain goods, and a change in the Department of Revenue’s audit schedule.

“We’ll save that for another day,” Mesnard said of his proposal for fewer brackets. “I didn’t want to lose all the rest of the provisions for that one thing.”

A 2011 flat-tax proposal by then-Rep. Steve Court, R-Mesa, was approved by the House but defeated in the Senate after trade associations and taxpayers voiced concerns about the bill’s impact.

Members of the 2013 task force insisted that any changes to the income tax shouldn’t make any Arizonan pay more in taxes, particularly the poor.

Some on the task force also felt that there wasn’t much wrong with Arizona’s income tax system, and they questioned whether there was a need to adjust the system at all.

Mesnard said he hopes to continue discussing a flat tax rate in the future, possibly as part of a broader review of Arizona’s tax system.

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