Andy Biggs, the Republican gubernatorial candidate in Arizona, said he wants to eliminate the state’s personal income tax “incrementally.”
If Arizona were to fully remove its personal income tax, it would be the 10th state in America without an income tax, joining Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.
Currently, Arizona has a personal income tax rate of 2.5 percent.
Biggs’ plan to slowly reduce the state’s personal income tax is similar to what Tennessee did nearly a decade ago. In 2017, then-Governor Bill Haslam signed a bill into law that would eliminate the state’s personal income tax over a four-year period.
In 2021, Tennessee fully eliminated its personal income tax.
The White House Council of Economic Advisors released a report in January that said the average state that phases out its personal income tax will see a 1 percent to 1.16 percent GDP increase.
On top of this, the average state will see its startups increase by 16 to 19 percent, while also seeing the average wage in the state go up by $4,000.
The report also found the average state will see a big influx of high-income taxpayers.
Furthermore, five states without a personal income tax ranked in the top 10 in America in GDP growth in the last 10 years.
States with no personal income tax saw bigger net migration patterns than states with high income taxes such as California, New York, and New Jersey.
Since 2021, Tennessee has seen numerous businesses move or open offices in the state, including Starbucks, Oracle, In-N-Out Burger, and Kaiser Aluminum.
The 2026 version of the Rich States, Poor States report ranks Tennessee as having the second best economic outlook for a state, only behind Utah.
Without a personal income tax, Tennessee collects nearly 50 percent of its tax revenue from its general 7 percent sales tax, according to the Tax Foundation.
The Volunteer State collects nearly 21 percent of its tax revenue from property taxes and 9 percent from its 6.5 percent corporate income tax.
According to the Tax Foundation, Arizona gathers almost 13 percent of its tax revenue from its personal income tax.
Arizona gets nearly 50 percent of its tax revenue from its 5.6 percent sales tax. Property taxes make up nearly 25 percent of the state’s tax revenue, while its 4.9 percent corporate income tax rate only provides it with 4.2 percent of its tax revenue.
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Zachery Schmidt is the digital editor of The Star News Network. Email tips to Zachery at zschmidt1717@gmail.com.
Photo “Andy Biggs” by Andy Biggs.
