Local Economic Incentives
The following are a snapshot of incentives offered by the five jurisdictions that make up the Sun Corridor. Incentives are generally offered to projects that meet specific criteria and qualifications. Please contact Geoff Shumway to learn more.
Foreign Trade Zone Program (FTZ)
- Companies qualifying for benefits under the Foreign Trade Zone Program can receive many incentives
- Merchandise may be brought in duty-free for purposes such as storage, repacking, display, assembly or manufacturing
- Imports may be landed and stored quickly without full customs formalities
- In addition, Arizona is the only state that reduces property taxes by 75% for businesses located within a Foreign Trade Zone or Sub-Zone
Job Training Program
- Job training grants of up to $8,000 per employee for a maximum $1.5M
- Employers awarded grants of up to 75% of expenses incurred while providing technology skills training
Private Activity Bonds
- In Arizona, private activity bonds are issued through Industrial Development Authorities. They can be used to finance manufacturing facilities, warehouses, office buildings, parking facilities, infrastructure, etc.
- Interest on private activity bonds for infrastructure is exempt from federal income tax
- Manufacturers can utilize up to $10 million in bonds
Primary Jobs Incentives
- Electrical, plumbing, mechanical, grading permit and site review permit fees are waived
- Up to 100% construction sales tax allocated to job training, off site, public infrastructure improvement sand/or impact fee offsets.
New Market Tax Credits
- Below market interest loans guaranteed by federal government for the purpose of stimulating development in rural communities. Companies utilizing New Market Tax Credits pay on the interest only of the loan for seven years. After the 7th year, the loan is forgiven and the company is awarded the principal and equity of the loan.
Arizona Economic Incentives
The following are a snapshot of incentives offered by the State of Arizona, regardless of where the project is located. To learn more about these and other statewide incentives, please visit www.azcommerce.com.
Arizona Competes Fund
- Deal–closing fund of $25 MM to attract base industry
Arizona Quality Jobs Program
- $9,000 credit over three years for new qualified jobs
- Reduces personal property taxes on equipment and machinery
Corporate Income Tax Rate Reduction
- By 2017, corporate income tax rate steadily decreases from 6.968% to 4.9%
R&D Tax Credit Program
- Refundable and nonrefundable corporate income tax credits for qualified research and development done in Arizona, including company funded research at a state university
- Credit amount is 24% of first $2.5 million in qualifying expenses and plus 15% of the qualifying expenses in excess of $2.5 million
- Qualifying small companies (less than 150 FTE) can apply to make their credit refundable (75% of nonrefundable credit value). A company can receive up to $2M in refundable credits per year
- Research and Development Tax Credit now includes a 10% bonus credit for eligible expenses paid to colleges and universities under the Arizona Board of Regents. (HB2001)
Renewable Energy Tax Incentive Program (RETIP)
- Refundable corporate income tax credit for up to 10% of capital investment
- 75% reduction in property taxes for up to 15 years
- Applicable to manufacturing and headquarters operations locating anywhere in the state
- Companies not receiving property tax incentives under the RETIP or FTZ programs can elect to take additional depreciation on their personal property
- Additional depreciation encourages new capital investment by quickly reducing personal property tax liability
100% Sales Factor
- Starting in 2014, sales factor ramps up from 80% to 100%