AZ HB2590

Removes requirement that contractors hold transaction privilege tax (TPT) licenses to obtain building permits, allowing cities and towns to issue permits without requiring a TPT license as a precondition.

Eliminates the requirement in contractor licensing (A.R.S. § 32-1122) that applicants provide their TPT license number, replacing it with certification of workers' compensation insurance compliance.

Establishes new tax liability rules in section 42-5008.01 for prime contractors and subcontractors who purchase materials tax-exempt and incorporate them into taxable projects, requiring them to report and pay tax on those materials.

Creates certificate system allowing non-licensed contractors to purchase materials tax-exempt for projects controlled by prime contractors, with liability shifting to the prime contractor if certificates are provided.

Clarifies and simplifies prime contracting tax classification by redefining key terms like "modification," "alteration," and "owner," and establishing thresholds and procedures for when maintenance and repair work is taxable versus non-taxable.