On August 19, the Arizona Supreme Court allowed voters in the state to approve the new tax on high-income earners in November. While the lower courts decided whether the income it raised for the school would exceed the constitutional spending limit. The High Court’s ruling is a major victory for supporters of education, but it may only be short-lived.
The decision expressed that if the lower court decided that as far as possible was surpassed. It should announce Proposition 208 as illegal and totally invalid.
A judge’s dissenting opinion stated that the framework imposed by the court to analyze spending limits. That was “almost certainly” doomed to the failure of the measure.
The Arizona Supreme Court rejected the opponent’s argument:
The court rejected the opponent’s argument that Proposal 208 requires 2/3 votes to be promulgated, which is required by the tax increase imposed by the legislature.
However, the court said that it was still unable to determine whether the funds it raised could be used legally, so it sent the case back to the lower court.
In 2018, the Supreme Court ruled that a version of the initiative was not well written, and removed a version of the initiative from the vote. However, supporters proposed a revised version last year, which won weak voter support.
Proposition 208 is expected to raise more than 800 million U.S. dollars for K-12 schools each year by raising income taxes for high-income residents in Arizona.
The challenge was raised by Republican legislative leaders and business groups, who believed that the new tax would hinder the wealthy from living or investing in the state, thereby harming the economy. Republican Governor Doug Ducey also strongly opposed and expressed his hope that the Supreme Court would find it unconstitutional.
Ducey has appointed five of the seven members of the court.
The legislature abolished some taxes at the meeting that ended in June, but supporters of the Education Investment Act are collecting signatures to block new tax cuts and asking voters to abolish them.
The court focused on spending limits in an oral argument in April. Judge Bill Montgomery pointed out that if the court finds that the exemption of this money as a grant is illegal, the approximately $600 million in new cash may not be used.
The ruling on Thursday did exactly that. The Speaker of the Senate Karen Vann issued the following statement, stating that she was “satisfied” with the results.
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