Hobbs Vetoes Tax Relief Bill

January 16, 2026 ADI Staff Reporter
veto

On Friday, Arizona Gov. Katie Hobbs surprised no one when she announced that she vetoed a tax plan aimed at providing relief for Arizona’s families.

The Legislature sent the first bill passed this legislative session to Hobbs’ desk on Thursday.

Republicans said the plan would deliver Arizonans $1.1 billion in tax relief over three years.

Arizona House Speaker Steve Montenegro said the bill, dubbed the Arizona One Big Beautiful Bill, provided tax relief over three years while maintaining a balanced state budget and protecting Arizona’s reserves.

“Yesterday, the Arizona House came together with the Senate to lower costs and improve affordability through tax relief for Arizonans,” said Montenegro. “Governor Hobbs’ veto of our tax relief act is a failure of leadership that will create unnecessary confusion and disruption for millions of Arizona taxpayers.”

Montenegro claimed that Republicans “acted early and responsibly to give families, seniors, and small businesses certainty as tax filing season approaches. We passed a clear plan—months in the making—that conforms Arizona law to federal tax changes, provides relief for working families, and tells taxpayers, in statute, what they owe.
The Governor admitted swift action was needed. She asked for a bill to be sent quickly. We did exactly that.”

“Instead,” said Montenegro, “Arizonans are left with mixed signals from the executive branch, uncertainty for taxpayers, and confusion for employers and tax preparers—all created by this veto.”

By vetoing the bill, Governor Hobbs vetoed:

  • An increase to the standard deduction
  • A deduction for childcare expenses
  • An increase to the child tax credit
  • No tax on tips
  • No tax on overtime
  • Relief for seniors

“The chaos ahead is not accidental,” said Montenegro. “It is the direct result of Governor Hobbs’ decision to veto a responsible tax conformity bill with no replacement plan.”

“The Republican majority in the legislature is hell-bent on giving handouts to the wealthiest Arizonans while hiking taxes on working seniors,” claimed Hobbs upon the bill’s passage. “Their proposal gives hundreds of millions of dollars in tax breaks to special interests, removes a tax cut for working seniors, and adds even more handouts to those who are already rich. If Republicans want to give a billion dollar tax break for the wealthy, they must show the people of Arizona how they will pay for it without slashing the vital services our constituents rely on. We need tax cuts for middle class families now.”

Hobbs introduced her budget proposal on Friday, which Republicans say “raise serious concerns about unrealistic revenue assumptions, hidden tax increases, and policies that would raise costs for Arizona families while creating long-term tax confusion.”

“Governor Hobbs’ budget is a fantasy built on fake revenues and hidden tax hikes,” said Montenegro. “She can call them ‘revenue enhancements,’ but Arizona families will feel them as higher costs and higher taxes. This is a liberal, California-style budget that grows government, creates tax chaos, and gambles with taxpayer dollars. House Republicans will reject it and fight for a responsible, balanced budget that puts Arizona families first.”

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9 Comments

  1. Joe Biden had his autopen. Katie Hobbs has her veto-pen. However, AZ should become an example of putting a government in place that can actually govern. Until the legislative and executive branches can grow up, sit down together and negotiate, all that will happen is a repeat of the federal government with a bunch of congress-critters wrestling for control against the executive. Frankly, we need to fire the lot of them.

  2. I’ve been called the veto Queen
    And accused of being obscene
    My actions I warrant
    By being abhorrent
    As I like to be seen as mean

  3. what would you expect, this is the only thing she knows how to do! Pass a bill removing party afilitation on voting forms and see how the dems/leftists come out. They know the low ignorant voters here only look for the party of the individual running not the positions that they may have that would benefit all. As to the R’s they have nothing going on here in the state to make them standout, its almost like they dont exist!

  5. Snooze, no one in Arizona knows this because AZ Rs are terrible at getting their message out. Oh look a press release no one reads from those bad mean old Republicans. Meanwhile Hobbs, Mayes and Fontes have papers, TV, radio and Broomhead all sucking up and paid staffers doing it

  6. Well I called that one. Democrats hate cutting taxes on the middle class. They’d rather keep the loopholes open in the tax code for their wealthy donors than give relief to the little guy.

  7. “Katie Hobbs surprised no one when she announced that she vetoed…”. Boy, didn’t see this coming 😂

    You hear Montenegro on the radio saying they gave Hobbs everything she asked for and removed what she didn’t want and now this. Someone is not telling the whole story and it just makes everyone look bad and not interested in really making a difference!

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