AZ HB2255

Amends the school tuition organization (STO) tax credit cap structure beginning fiscal year 2019-2020 by replacing automatic 20% annual increases with a conditional growth trigger.

Starting fiscal year 2019-2020, the aggregate STO tax credit cap will only increase by 20% if either the transaction privilege tax growth rate or total nonfarm employment growth rate is 2% or greater.

If both the transaction privilege tax growth rate and total nonfarm employment growth rate are less than 2%, the directors of the office of strategic planning and budgeting and joint legislative budget committee must jointly notify the department of revenue by February 1, and the credit cap will remain flat with no increase.

Prior to fiscal year 2019-2020, the credit cap continued the existing 20% annual increase from the previous fiscal year (in effect through fiscal year 2018-2019).

Applies retroactively to June 30, 2019.