Arizona advances bills to exempt crypto from property taxes

The Arizona Senate Finance Committee advanced S.C.R. 1003 and S.B. 1044 on Monday, bills that aim to exempt crypto from property taxes. Both legislations are pending voter approval in November.

The state’s committee voted 4-3 on the Senate Bill 1044 after Senator Wendy Rogers introduced the bill last month. The legislation aims to exempt digital assets from property taxation. The Senate Concurrent Resolution 1003 was also introduced on the same day, and seeks to amend Arizona’s constitution to formalize that exemption.

S.C.R. 1003 and S.B. 1044 await public vote in November

The pair of bills is now headed to the Senate Rules Committee for approval. The S.B. 1004 legislation only becomes effective if the S.C.R. 1003 bill gets approved by voters at the next general election.

S.C.R. 1003 needs to clear all legislative steps and then public approval in November 2026 before it becomes effective. The bill’s approval would place a constitutional amendment before Arizona voters, seeking to define virtual assets and prohibit ad valorem taxation of such assets.

The Senate Bill seeks to amend state law to reflect that prohibition. S.B. 1044 also exempts digital assets from taxation and defines cryptocurrencies as a digital representation of value functioning as a medium of exchange. The legislation also classifies digital assets as a unit of account and a store of value other than a representation of the U.S. dollar or a foreign currency.

Rogers has previously introduced similar tax exemption bills last year, which passed the Senate but failed to advance in the state House. The senator previously sponsored the Arizona Strategic Bitcoin Reserve Act (Senate Bill 1025), which sought to allow state treasurers and retirement systems to allocate up to 10% of state funds into digital assets.

Arizona’s lawmakers have been trying to advance the state’s crypto policy in the legislature, but have repeatedly faced resistance from the Governor’s office. Arizona’s Governor Katie Hobbs has already vetoed four crypto-related bills during the previous year.

Governor Hobbs vetoes several crypto-related bills

Cryptopolitan previously reported that Hobbs rejected Roger’s Strategic Bitcoin Reserve Act (S.B. 1025) in May last year. She argued that retirement funds are not the place to trial untested assets like crypto.

Arizona’s governor also vetoed Senate Bill 1373, which aimed to establish a Digital Assets Strategic Reserve Fund to hold virtual assets obtained from seizures. She argued that the current volatility in the crypto industry doesn’t make a prudent fit for general fund dollars.

Hobbs also rejected Senate Bill 1024, which would allow state agencies to accept digital asset payments for fines, taxes, and fees. She stated that the legislation leaves the door open for too much risk.

Arizona’s governor also vetoed House Bill 2324 in July last year. The bill sought to create a Bitcoin and Digital Assets Reserve Fund holding digital assets seized in criminal investigations. She argued that the legislation disincentivizes local law enforcement from working with the state on crypto forfeiture by removing seized assets from local jurisdictions.

However, Hobbs approved House Bill 2749 and House Bill 2387 in May last year. The first legislation sought to modernize unclaimed property laws to allow digital assets to be held in their original form rather than liquidated. The other bill imposed strict fraud prevention, transaction caps, and compliance rules on crypto ATM operators. 

House Commerce Committee Chairman Jeff Weninger said the legislation ensures Arizona doesn’t leave value sitting on the table. He also believes the bill will put the state in a position to lead the country in securing, managing, and benefiting from abandoned virtual currency.

Get seen where it counts. Advertise in Cryptopolitan Research and reach crypto’s sharpest investors and builders.