Tucson Set to Introduce Transaction Privilege Tax to Fund Social Initiatives

By Staff Reporter |

The Tucson City Council is set to propose a new transaction privilege tax aimed at funding various social initiatives. Aimed to be temporary, this tax would impose an additional one-half cent (0.5 percent) on transactions, with anticipated annual revenue reaching $80 million, culminating in a total of $800 million over ten years.

If approved in the upcoming council meeting on Wednesday, the tax would be featured on the “Safe and Vibrant Tucson” ballot measure, allowing voters to weigh in during a special election slated for March 2025. This election will utilize a mail-in voting system rather than in-person ballots.

The city has estimated that organizing this mail-only election will cost no more than $1.1 million. Initially, the ballot measure was expected to appear in July but was delayed due to legal concerns regarding the timing of local sales tax proposals, which the state mandates must occur only in even-numbered November elections. Following a review request from Democratic Senator Rosanna Gabaldon, Attorney General Kris Mayes provided a legal opinion supporting the city’s intent to hold the election on its preferred timeline.

Despite the legal endorsement, city officials decided against the July election, instead opting for a vote in March 2025. If passed, tax revenue will be distributed to various public sectors, including 30 percent directed toward capital investments for first responders, 22 percent for enhanced emergency response systems, 17 percent for affordable housing and shelter initiatives, 16 percent for community resilience programs, and 12 percent for technological improvements.

Funding for first responders will support the procurement of essential equipment, including protective gear, specialized fire vehicles, and upgrades to police and fire stations. Enhanced emergency response funding will increase staffing for police, fire departments, and emergency call centers.

The affordable housing allocation will support Tucson’s Housing First program, provide assistance for emergency shelters, and promote long-term investment in residential properties. Community resilience efforts will fund youth programs, early education scholarships, and various beautification initiatives throughout neighborhoods.

Technology investments will improve the capabilities of emergency call systems and enhance police operations through upgraded aircraft and data management systems. The focus on public safety funding aligns with insights gathered from over 800 respondents in the city’s recent community budget survey.

City officials have clarified that road infrastructure funding will not be part of the proposed ballot measure. As the special election approaches, residents and stakeholders will be keenly observing the developments surrounding this significant funding initiative.