Today, the Goldwater Institute won a major court victory, defeating the largest tax hike in Arizona’s history. The decision by a Maricopa County judge bars the enforcement of Proposition 208, a measure that would have massively increased income taxes, led to staggering job loss, and turned Arizona from one of the lowest-taxed states in the country to one of the highest.
CV2020-015495 – 3.11.2022 – Ruling
In August 2021, the Arizona Supreme Court refused to stop Prop 208 from going into effect. Instead, it instructed Judge Hannah to permanently enjoin the measure if he found the revenue would exceed the aggregate expenditure limit.
Despite the fact that over 20 schools were set to exceed aggregate expenditure limit by more than $1.1 billion, Arizona legislators passed an override measure to allow schools to legally spend money they already had. Lawmakers had hoped Hannah would rule as expected earlier so that the override measure would be unnecessary.
“A Maricopa County judge this morning issued an injunction in the Goldwater Institute’s lawsuit against Proposition 208 which blocks enforcement of the massive tax increase adopted in November 2020. Following instructions from the state’s Supreme Court—which months ago said the initiative’s tax hike must be struck down if the money the initiative raises cannot be spent without exceeding the state’s constitutional limits on government spending—today’s decision concluded that “school district spending more likely than not will exceed the predicted spending limit in 2023,” and declared the entire initiative invalid.” – Timothy Sandefur, of the Goldwater Institute
Opponents like Arizona State Senate President Karen Fann said on Friday that the “initiative misled Arizona voters by proposing a tax and spend hike that tried to get around the state’s constitutional expenditure clause.”
“Out-of-state special interests tried to deceive our voters,” said Fann. “We are thrilled that this job-killing tax hike won’t go in effect. Now the state’s leaders can pursue important education funding while we craft next year’s budget.”