HB2807 proposes amendments to the definition of "alteration" and "modification" under the prime contracting classification in Arizona's transaction privilege and use tax law. The bill redefines "alteration" to mean an activity that causes a direct physical change to existing property without increasing the square footage of the existing residential structure under the roof. It also specifies that for non-residential property, the alteration definition does not apply if the contract amount exceeds $750,000.

The bill further redefines "modification" to include activities that increase the square footage of the existing residential structure under the roof, in addition to construction, grading, leveling ground, wreckage, and demolition. The bill sets an effective date of January 1, 2024, and includes technical and conforming changes to the statute.

Statutes affected:
Introduced Version: 42-5075
House Engrossed Version: 42-5075