Arizona offers a wide variety of economic incentive programs to promote and encourage high-wage job growth and capital investment. The Arizona Department of Commerce is the central source of information for Arizona's business incentives. Please contact the Arizona Department of Commerce and review in detail the available business incentive programs at: Arizona Department of Commerce
Industrial Development Authority (IDA)
The Pinal County IDA promotes and encourages economic growth and job creation by making low-interest loans available to qualified projects through the issuance of tax-exempt bonds. Financing must meet all state and local bond law requirements, and all projects are reviewed by the IDA to ensure that financing candidates represent projects that will help to further Pinal County’s vision for economic progress and sustainability. For further details about the IDA and bonding programs, please contact Tim Kanavel, Pinal County Economic Development Manager or call 520-866-6664/877-339-2630.
Pollution Control Tax Credit
This tax credit is administered by the Arizona Department of Revenue (AZDOR). The credit provides a 10 percent income tax credit on the purchase price of real or personal property used to control or prevent pollution.
Commercial/Industrial Solar Energy Tax Incentives Program Summary
The primary goal of the Commercial/Industrial Solar Energy Tax Credit Program is to stimulate the production and use of solar energy in commercial, industrial or any other non-residential applications by offsetting the initial cost of solar energy devices. The program achieves this goal by providing an income tax credit for the installation of solar energy devices in Arizona business facilities.
An Arizona income tax credit is offered to businesses that install one or more solar energy devices in their Arizona facilities. The tax credit is equal to 10% of the installed cost of the solar energy device not to exceed $25,000 in credits for one building in a single tax year and $50,000 total credits per business per tax year. Tax credits can be used to offset Arizona income tax liability; any unused credit amounts can be carried forward for a five-year period. The tax credit is available for tax years beginning from and after December 31, 2005 through December 31, 2012.
Additional Depreciation (formerly: Accelerated Depreciation)
Provides an additional depreciation schedule to encourage new capital investment by reducing personal property tax liability. The additional depreciation schedule is applied to the first five years of the property assessment and accelerates depreciation by five percentage points per year for five years. In year one, the additional rate is 30%; in year two – 46%; in year three – 62%, and in year four –78%; in year five – 94% of the scheduled depreciated value. After the fifth year, taxable value continues to be determined using Arizona Department of Revenue (ADOR) schedules. The additional depreciation schedule is based on ADOR replacement cost new less straight-line depreciation schedules. This program applies to class 1 (commercial and industrial) personal property and class 2 (agricultural) personal property.
Government Property Lease Excise Tax Program (GPLET)
This program has been established by the State of Arizona and is available to businesses that lease parcels from a municipality rather than own them outright. All real property tax has been waived and replaced with an excise tax that is an established rate per square foot and based upon the type of use. The rate is reduced every ten years by 20% until it reaches the 51st year, when the tax drops to zero. In some redevelopment districts, the excise tax can be abated for the first eight years after the certificate of occupancy. If a municipality is a property owner, this creates a huge incentive for a company to occupy the facility, or allows them the cash flow to perform improvements. Any business or entity occupying a facility on property owned by the municipality (the building may be owned by the private entity, but land on which it sits must be leased from a city). The program typically is used to spur development and redevelopment in downtown areas.
For further and more detailed information regarding these programs and incentives, please visit the Arizona Department of Commerce or call 602-771-1100