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Sales Factor Only Apportionment Formula All non-air carrier taxpayers may use Arizona's SALES FACTOR ONLY apportionment formula, which is determined by dividing Arizona Sales by Everywhere Sales.
ALL EMPLOYEES - ARIZONA STATE WITHHOLDING HAS BEEN UPDATED TO THE DEFAULT RATE 2.0% Any existing additional dollar amounts an employee had chosen to be withheld will not be changed.
Changes to the 2023 tax rate structure mean changes to state withholdings from your paychecks. The new default withholding rate for AZ is 2 percent, so now is the time to review if this amount is appropriate for you. If you want to change this percentage, you can do so at any time during the year.
Arizona has a 4.90 percent corporate income tax rate, a 5.60 percent state sales tax rate, a max local sales tax rate of 5.30 percent, and a 8.37 percent combined state and local sales tax rate. Arizona's tax system ranks 19th overall on our 2023 State Business Tax Climate Index.