Panel backs bill to force earlier review of federal tax-conformity effects
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Summary
The committee returned HB 4029 (as amended) with a due‑pass recommendation. The bill requires OSPB and JLBC to evaluate income‑tax revenue effects from federal changes and obliges the governor to assess whether a special session is needed if the change is $100,000,000 or more; DOR must also file annual reports on federal IRC revisions.
The House Ways and Means Committee voted to return HB 4029, as amended, with a due‑pass recommendation after testimony from tax researchers and advocates.
Staff explained the amendment that directs the Office of Strategic Planning and Budgeting and the Joint Legislative Budget Committee to each evaluate whether changes to federal law will increase or decrease state income‑tax revenues by $100,000,000 or more; if either body projects such a change, the governor must determine whether a special session is necessary. Staff also said the Department of Revenue must submit an initial report summarizing Internal Revenue Code revisions by Sept. 30 each year and a final report by Jan. 10.
Kevin McCarthy, president of the Arizona Tax Research Association, supported the bill and told members it “turns the clock back” by forcing JLBC and OSPB to confront substantial federal changes earlier so the executive and legislature can act before DOR issues tax forms. Other members warned the measure could add bureaucracy or interfere with DOR’s longstanding practice of assuming conformity when preparing forms; supporters said the bill merely forces an earlier conversation and a transparent report to the legislature.
After debate and a vote to adopt the amendment, the committee returned HB 4029 as amended with a due‑pass recommendation (vote 5 ayes, 4 nays). The bill includes reporting deadlines and the $100,000,000 fiscal threshold described by staff.
