1. TPT Reform Update Presented by
Lee Grafstrom, Tax Policy Analyst – League of AZ Cities & Towns
GFOAz Winter Training
February 15, 2017

2. Where Are We Now? TPT Reform Update
Single Audit – New rules began January 2015
New Reports – Program, June 2016
Tax License Renewal – 2017
State Administration – January 2017

3. Audit TPT Reform Update
Cities can do any “local” or City-Tax-Only audits
DOR will do all “multijurisdictional” audits
Technically, DOR “leads” all audits
City auditors may perform any audit functions and work on behalf of DOR

4. New Reports to the Cities New License Report License Update Report
TPT Reform Update
New Reports to the Cities
New License Report
License Update Report
City Payment Journal
Deduction Report
No-Money Report
Fund Distribution Report

5. Recap of Tax Law TPT Reform Update
MCTC Article III eliminated the option to hold up a Tax License for other approvals
A.R.S requires all Tax licensing be administered by ADOR for all cities and towns, beginning 1/1/2015
All new applications and annual renewals for a Tax License will be handled by DOR

6. Business License – Purpose
TPT Reform Update
Business License – Purpose
Provides the ability to regulate the approval process and have independent knowledge of all business activity within the city
Provides significant demographic data used by various city functions, such as economic development, planning, zoning, police & fire
A full Business License program assists city efforts to review tax payments and reports received from ADOR

7. What If We Don’t? TPT Reform Update
Changes to MCTC and State statute preclude waiting for other approvals for a Tax License
No unifying process that ensures all approvals are acquired by all businesses
Generally, ADOR only licenses businesses that generate a tax liability: a limited view of businesses in your city
Identifying all businesses in the city is not possible if you rely on ADOR data alone