Bill
SB 1845
SB 1845 broadens and reorganizes Arizona tax provisions, increasing reporting rules, updating premium tax rates, introducing IO center investment thresholds, and expanding confiden
SB 1845 — Taxation Omnibus (Arizona, 57th Legislature, 2nd Regular Session, 2026)
Overview
SB 1845 is a broad taxation omnibus bill that reorganizes and expands various tax provisions across multiple tax types, repeals several existing sections, and adds new definitions and framework for confidential information sharing and administration. The measure touches premium taxes for insurers, taxes on health and dental service organizations, vehicle-related taxes, and several provisions affecting state revenue distribution and administration. It also includes updates to definitions and confidentiality rules for the Arizona Department of Revenue (DOR) and related agencies, and adds new or revised tax credits and deductions referenced throughout.
Key Provisions and Changes
1) Insurance Premium Tax (Sections 1, 2, 3, 4, 5, 6, 7)
- Repeals Section 20-224.03 and consolidates premium tax rules under Section 20-224 with revised rates and filing requirements.
- Premium tax rates (for non-fire lines) are gradually reduced over time for “other insurance” from 1.95% (2016) down to 1.70% (2021 onward), with fire insurance and disability insurance rates specified separately.
- Fire insurance premia are allocated: 0.66% on property located in cities certified as procuring private fire services; 2.2% on other property.
- Introduction of monthly pre-payments for high-volume insurers (>$50,000 premium tax) equal to 15% of prior year’s amount, due March–August.
- Clarifies treatment of credits and refunds related to premium taxes; directs reporting and allocation of fire premium taxes to municipal or fire district retirement systems as applicable.
- Several provisions ensure electronic filing options and specify how deductions and credits can be claimed.
2) Other Insurance Taxes (Sections 5, 6, 7)
- Premium taxes for prepaid dental plans (2.0%) and health care services organizations (2.0%), with exemptions for certain federal program receipts (e.g., US HHS contracts).
- Premium tax credits remain available for entities eligible under other credit provisions (cross-referencing other sections).
3) Vehicle-Related Tax and Permits (Section 8)
- Amends 28-2154.01 related to special ninety-day nonresident vehicle registration permits, including electronic record-keeping, record retention, duties of dealers, and purchaser liability if vehicle is later registered in Arizona.
- Requires compliance with notice requirements and forms to be jointly developed by the Department of Transportation and DOR.
4) International Operations Centers and Utility Relief (Section 9)
- Establishes a framework for utility relief certification for International Operations Centers (IOCs) determining eligible renewable energy investments and self-consumption requirements.
- Sets investment thresholds (minimums: $100M annual capital investment for 10 years; $1.25B by year 10; $100M in renewable energy facility investments within a three-year window ending 2030).
- Requires annual reporting to demonstrate progress toward investment thresholds and self-consumption targets (minimum 51% self-consumed energy by year five).
- Allows revocation of IO center certification for noncompliance; requires offset payments if certification is revoked or investment thresholds are not met.
- Defines terms such as “affiliated entity,” “renewable energy facility,” and “renewable energy resource.”
5) Confidentiality and Authorized Disclosures (Sections 11, 12, 13)
- Updates to definitions and processes governing confidential information sharing within DOR and with other agencies (e.g., IRS, state agencies, tribal entities) for tax administration purposes.
- Expands and clarifies who may receive confidential information and under what circumstances, including court proceedings and interagency data sharing.
- Adds specific protections and requirements for redaction and handling in administrative and judicial settings.
- Addresses public disclosure restrictions and allows limited public release of aggregated data or IO center disclosures.
6) Distribution and Remittance (Section 14)
- Revisions to how tax revenues are deposited, allocated, and distributed to municipalities, counties, and other entities, including specific percentages and allocation methodology.
Impact and Reach
- Affects insurers, health care service organizations, prepaid dental plans, motor vehicle dealers, and entities pursuing IO certification for tax relief and renewable investments.
- Changes to premium tax rates and reporting timelines may alter annual state revenue and insurer pricing structures.
- IO certification and renewable self-consumption requirements could drive significant capital investment and energy infrastructure development.
- Expanded confidentiality sharing and stricter oversight may affect how tax information is accessed and used by state and federal partners.
Timing
- The bill’s effective dates are not explicitly listed in the excerpt; many provisions reference calendar years for rate phases and reporting timelines.
Note
- This summary focuses on substantive content and intended effects. For full implementation details, consult the bill text and any enacted amendments or referenced related statutes.
Compiled from official sources — confirm details with the bill’s official record.
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