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ERIC Number: ED457295
Record Type: Non-Journal
Publication Date: 2001-Sep-17
Pages: 36
Abstractor: N/A
The Arizona Scholarship Tax Credit: Giving Parents Choices, Saving Taxpayers Money. Policy Analysis No. 414.
Lips, Carrie; Jacoby, Jennifer
In 1997, Arizona policymakers created a $500 tax credit for contributions to organizations that give students scholarships to attend private K-12 schools. This analysis considers Arizona's experience with the tax credit. Researchers surveyed and interviewed representatives of Arizona's scholarship organizations and examined information from the Arizona Departments of Revenue and Education. From 1998 through 2000, the tax credit generated more than $32 million, which funded almost 19,000 scholarships through more than 30 scholarship organizations. Over 80 percent of scholarship recipients were selected on the basis of financial need. Researchers also estimated the impact of the credit on Arizona's budget. Although the state forgoes revenues as people exercise the credit, taxpayers save money when students who would have been educated at public expense use the scholarships at private schools. Although Arizona lost $13.7 million in 1999, once savings were considered, the credit was revenue neutral. Using moderate assumptions about the growth of taxpayer participation, the study estimates that by 2015, the scholarship credit will raise $58 million annually, fund 35,000-61,000 scholarships per year, and help send 11,000-37,000 students to their chosen schools. The cost of the credit is likely to be significantly less than savings resulting from student transfers. Five appendixes present projected savings data. (SM)
Cato Institute, 1000 Massachusetts Avenue, N.W., Washington, DC 20001 ($6). Tel: 202-842-0200; Tel: 800-767-1241 (Toll Free); Fax: 202-842-3490; Web site:
Publication Type: Numerical/Quantitative Data; Reports - Descriptive
Education Level: N/A
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: Cato Inst., Washington, DC.
Identifiers - Location: Arizona