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Lawmakers Should Pass a Budget that Helps Arizonans Deal with the Coronavirus Instead of More Tax Cuts for Corporations and the Wealthy


(Phoenix, AZ)

Thursday, March 12, 2020 

Pass a state budget that helps Arizonans in tough times instead of more tax cuts for corporations and the wealthy

Over the past decade, strong job growth and expanding financial markets have fueled Arizona’s economy, but now the novel coronavirus (COVID-19) outbreak has begun to take a toll across the U.S., prompting layoffs and triggering hiring freezes.

Meanwhile, the Arizona Legislature continues to negotiate a state budget for fiscal year 2021, proposing more than $300 million in new tax cuts that largely benefit corporations and the wealthiest Arizonans. A recent analysis conducted by the Institute on Taxation and Economic Policy shows that 74 percent of the capital gains and income tax cuts included in these proposals would accrue to taxpayers earning more than $119,000 per year.

Lawmakers have a choice to protect the health and economic security of all Arizonans by boosting investments that will uplift Arizonans impacted by the COVID-19 pandemic and shore up the state’s economy.

Protect Arizona’s workers by strengthening the state’s unemployment insurance program

The Unemployment Insurance (UI) program is designed to stabilize household income during large-scale unexpected job loss. Yet over the past several years, Arizona has weakened its UI program, raising barriers for workers, families, and communities to soften the impact of job loss during crises like pandemics or recessions. Today, Arizona’s average weekly benefit is $233, the second-lowest maximum UI benefit amount in the U.S.

Raising the unemployment benefit by $200 per week would bring Arizona closer to the national average (approx. $455/week) and that of all neighboring states. Doing so with the current level of UI payments would require additional general fund appropriations of approximately $176 million annually. Additional reforms to enhance the UI program could include the waiver of Arizona’s 1-week waiting period, addition of a dependent allowance, suspension of work search requirements, eligibility expansion, and coverage of the program’s administration costs in crises like outbreaks.

Eliminate the choice of keeping a job and staying healthy with paid family and sick leave

The Center for Disease Control and Prevention (CDC) has issued instructions to “stay home when you are sick” to prevent spread of COVID-19. However, that’s not an option for many workers in Arizona. According to the Bureau of Labor Statistics, only 17 percent of American workers have access to paid family through their employers and fewer than 40 percent have access to personal medical leave through employer-provided short-term disability insurance. A state paid family leave program creates a system that doesn’t unfairly punish low- and moderate-income Arizonans for taking time off to care for themselves or a sick family member, especially during this public health crisis.

“Arizonans are looking for leadership. Tax cuts will hinder Arizona’s readiness to respond to everyday workers and families harmed by COVID-19,” said David Lujan, Director of the Arizona Center for Economic Progress. “We call on state lawmakers to pass a state budget that includes more than $176 million in strategic investments to the unemployment insurance program and works to create targeted interventions for workers and families facing financial hardship.”


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The Arizona Center for Economic Progress
3030 N. 3rd St., Suite 650
Phoenix, AZ 85012

Building a Future that Works for All Arizonans