Phone 4 Energy™

Arizona Exempts Renewable Energy Certificates from State Sales Tax

Phone 4 Energy™

The Arizona State Legislature passed Senate Bill 1229 (SB1229), exempting the sale or use of renewable energy certificates (RECs) from Arizona’s transaction privilege tax, which is similar to a sales tax. SB1229 exempts the sale of RECs from transaction privilege taxes under both the retail sales provision and the utilities provision. The new legislation also exempts the sale or transfer of RECs from Arizona’s use tax, which is a tax on the use, storage, or consumption of tangible personal property. Solar electricity generated by customers and sold back to utilities is also exempt from transaction privilege taxes under the new legislation.