Steve Yarbrough
Howard Fischer/Capitol Media Services

Manufacturers and smelters would no longer have to pay state sales taxes on electricity they buy under the terms of legislation approved Thursday by the Senate.

SB 1413 is part of an economic development proposal by Gov. Jan Brewer. Aide Michael Hunter said she believes the levy could be the difference between a company moving here or going somewhere else.

The legislation drew opposition from cities which also would have been forced to give up on their own levies, a figure the League of Arizona Cities and Towns said would cut revenues overall by $9 million, with some cities hit harder than others.

As approved, the price tag for the state in lost revenues is up to $10 million.

Sen. Steve Yarbrough, R-Chandler, who sponsored SB 1413 inserted language to narrow the definition of who is a “manufacturer’’ and gets the tax break — and, more to the point, who does not. The final version of the bill specifically excludes processing, fabricating, job printing, mining, generating electricity or operating a restaurant.

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