PHOENIX — Tenants in Arizona may get some financial relief in the new year once the state repeals the transaction privilege tax for rental properties.
Starting on Jan. 1, property owners will be expected to stop collecting the residential rental tax. TPT licenses with the Arizona Department of Revenue that only have the residential rental code will be automatically canceled at the start of the new year.
The tax rate varies slightly among Arizona's municipalities, meaning tenants will likely see varying amount of relief depending on where they rent.
Phoenix's residential rental tax rate had been set at 2.3%, while Mesa's tax rate was set at 2%.
The tax applies to residential properties that are leased for a period of 30 or more consecutive days.
The Arizona Department of Revenue said owners will still need to register their rental property with the county assessor to comply with landlord tenant laws.
Republican lawmakers spearheaded the tax ban in order to address the rising costs of housing in Arizona. But many municipalities feared removing the tax would eliminate an important revenue source for city budgets.
Gov. Katie Hobbs initially rejected the proposed tax repeal, claiming it didn't guarantee a financial benefit for renters. Hobbs later signed off on eliminating the tax.
Watch 12News for free
You can now watch 12News content anytime, anywhere thanks to the 12+ app!
The free 12+ app from 12News lets users stream live events — including daily newscasts like "Today in AZ" and "12 News" and our daily lifestyle program, "Arizona Midday"—on Roku, Apple TV and Amazon Fire TV.
12+ showcases live video throughout the day for breaking news, local news, weather and even an occasional moment of Zen showcasing breathtaking sights from across Arizona.
Users can also watch on-demand videos of top stories, local politics, I-Team investigations, Arizona-specific features and vintage videos from the 12News archives.
Roku: Add the channel from the Roku store or by searching for "12 News KPNX."
Amazon Fire TV: Search for "12 News KPNX" to find the free 12+ app to add to your account, or have the 12+ app delivered directly to your Amazon Fire TV through Amazon.com or the Amazon app.
