AZ SB1203

Creates a notice requirement for the Joint Legislative Budget Committee to inform the Department of Revenue when a budget surplus exists, beginning in fiscal year 2023-2024 and continuing annually until the income tax rate reaches zero.

Defines "budget surplus" as the amount by which ongoing state general fund revenues exceed ongoing state general fund expenditures.

Mandates the Department of Revenue to reduce the individual income tax rate by 50% of any reported budget surplus amount, effective the taxable year following the notice.

Requires successive income tax rate reductions with each subsequent budget surplus notice, with reductions continuing until the tax rate reaches zero percent.