Despite the noble work of Republican lawmakers over the past five years to reduce the state’s burden on taxpayers (lowering and flattening the income tax, eliminating tax on renters, and addressing taxes on food,) cities and towns are constantly undermining this progress through rampant tax, fee, and utility rate increases.
Arizona’s affordability is being eroded through the insatiable tax-hungry decisions of city and town councils and their year-over-year spending sprees. If taxpayers have not noticed already, surely, they are feeling the pinch as these tax and fee hikes continue to stack one on top another. Red or blue, no city is immune, most likely your costs are going up.
Gilbert residents have been feeling these burdens on their wallets immensely this year. On January 1st of 2025, a tax increase was approved raising sales tax from 1.5% to 2%, and establishing a 2% use tax (previously Gilbert voters defeated the instantiation of a use tax via referendum in 2010), and hiking the bed tax to 5%. At the end of 2024, the Goldwater Institute sued the Town of Gilbert over the constitutionality of these sales-tax and bed-tax increases. Their lawsuit claims the city is violating a voter-approved provision of the Arizona Constitution that prohibits municipalities from imposing or increasing any tax on services (Prop 126, 2018), since Gilbert’s changes increase taxes on certain services like lodging and construction.
More recently, Gilbert residents have been shocked and upset by the astronomical rise in their water bills. In 2024, water bills went up 50%, in April 2025 another 25%, and one more planned 25% increase is set to take place in 2026. These kinds of outrageous, continuous increases hit families the hardest and will drive people away from Gilbert.
But where can they go for relief?
Certainly not the City of Phoenix. Starting in July of 2025, their Transaction Privilege and Use Tax (sales tax) increased 0.5% now sitting at 2.8%. According to the city, the increase is required to address a projected $39 million budget deficit. And this couldn’t possibly be attributed to Phoenix’s penchant for wasteful spending – like their $10 million Vision Zero program or their Office of Sustainability that self-imposes costly green new scam goals. The primary property tax levy increased by 1.22%, meaning residents with the same or higher home valuations will pay more. A 2% solid-waste fee increase occurred at the beginning of 2025 and is scheduled to happen again in January 2026.
This month, Phoenix will also consider raising inspection fees from $150 to $195 per hour and hiking hazardous material fees that will impact businesses and property owners. Phoenix city officials continuously show disregard for the financial strains persistently passed onto residents and businesses.
Unless you think you can afford to live in southern Arizona – Tucson is competing with Gilbert for who can have worse water rates. In August 2025, the City of Tucson adopted differential water rates for residents living outside city limits which includes a 5.5% base rate increase and two new fees: the Water Conservation Fee and Green Stormwater Infrastructure (GSI) Fee. Together these fees add $0.30 per hundred cubic feet (Ccf) of water to every Tucson Water bill, inside and outside city limits. This money will go to support ambiguous programs like “Homeowners Association education,” and “opportunities for low-income households.”
In September 2025, Tucson proposed several other fee and tax increases. A new 2.6% tax on Tucson businesses on all their local advertising – such as billboards, direct mail, radio. The proposal also increases the public utility tax from 4.5% to 5%, making it the highest public utility tax rate in the state. And the pawn shop and secondhand transaction fees would go from $1.00 to $3.00 per transaction. All this as if it isn’t hard enough surviving as a small business in Tucson…
Mesa is no longer a sanctuary of affordability in the state. On December 1st, the Mesa City Council voted to increase utility rates covering water, sewer, gas, electricity, and trash. Of the councilmembers present, all voted to increase the rate except one, the new councilwoman from District 2, Dorean Taylor. This is despite numerous members of the public speaking out against these rate hikes. But who cares about those guys? That seems to be the mindset of the Mesa Council after continuously raising rates and ignoring their constituents.
Listing every city and town raising taxes and fees would take too long. These are just a few examples of the same story playing out statewide.
But why are these increases so pervasive across Arizona cities and towns? According to the cities, they are all poor because the big bad state is starving their budgets. Since Republican lawmakers got to be Santa, slashing taxes, now cities must be grinch and raise them all!
And while taxpayers would certainly be the winners if the state stopped subsidizing the cities, it just isn’t true. When the Legislature lowered the state’s income tax to a flat 2.5%, the portion that went to cities (urban revenue sharing) increase from 15% to 18% in 2024. And though the cities seem to have complete amnesia about it, since 2019, the state began allowing the collection of online sales tax, a completely new and abundant source of revenue for the cities.
And the numbers bear this out. State Republicans have cut taxes, this has spurred more investment and wealth creation in the state, and as a result tax revenues have continued to climb. In Phoenix, for example, they collected $3.9B in revenues from taxpayers, and just four years later they raked in $5.7B – a 45% increase in their collections! Lest you think this is spurred by a boom in population, broken down by the number of residents, collections actually increased per resident by $1000 in only that four-year period!
It truly never ends. Taxes climb, fees multiply, and every year the cost of simply living in Arizona grows because cities and towns refuse to live within their means. Left unchecked, this steady creep of local taxation will drain families, punish homeowners, and crush the affordability in our state.
Just as the Republican-led Legislature stepped up to make Arizona affordable by cutting income taxes, it may once again fall to them to rein in local governments that can’t seem to stop reaching deeper into the pockets of hardworking taxpayers.
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