Dimensions of Sales Tax Exemption Policy: The Arizona Model

Mark A. Hager, Susanne McArdle

    Research output: Contribution to journalArticlepeer-review

    1 Scopus citations


    State exemption of qualified nonprofit organizations from paying sales taxes on certain purchases is one tool by which government encourages private development and delivery of public goods. We review Arizona's "transaction privilege"exemption for health nonprofits through review of statutes, interviews with state officials, interviews with nonprofits that seek and make use of the exemption, and secret shopping with Arizona businesses to see how they react to requests for tax-exempt purchases. We conclude that public data is inadequate for a full policy evaluation and that current exemption procedures include imprecision regarding which nonprofits qualify for the benefit. Nonetheless, given the policy goal of advancing public goods, we suggest that the exemption might fruitfully be extended to other categories of qualified nonprofits.

    Original languageEnglish (US)
    Pages (from-to)45-57
    Number of pages13
    JournalNonprofit Policy Forum
    Issue number1
    StatePublished - 2015


    • Arizona
    • nonprofit organizations
    • sales tax exemption

    ASJC Scopus subject areas

    • Sociology and Political Science
    • Economics and Econometrics
    • Public Administration


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