This bill proposes updates to current statutes regarding the Arizona Department of Revenue's (ADOR) process for interpreting and applying tax laws. Under the new provisions, if a proposed interpretation or application of tax law is expected to adversely affect taxpayers, ADOR is required to notify the chairpersons of the Senate Finance Committee and the House of Representatives Ways and Means Committee before the new interpretation is adopted. Additionally, if these committees hold a hearing on the matter, ADOR must provide testimony explaining the necessity of the proposed interpretation or application.

The bill also makes conforming changes to existing language, including the removal of the authority for the committees to recommend the adoption or rejection of proposed interpretations and the stipulation that a new interpretation takes effect after 60 days if no hearing is held. The definition of "new interpretation or application" is clarified to include policies and procedures adopted by administrative rule, tax rulings, tax procedures, or instructions to a tax return. Overall, these updates aim to enhance transparency and protect taxpayers by ensuring legislative oversight of significant changes in tax law interpretation.

Statutes affected:
Introduced Version: 42-2078
Senate Engrossed Version: 42-2078