Glossary · Invoicing & Pricing
The factor
In short
The number a contractor multiplies a tax-inclusive flat price by to arrive at the tax owed. It varies by location and is not one statewide figure.
In full
The factor is the number used to perform tax factoring. Multiplying a tax-inclusive flat price by the factor for the project's location produces the tax to report.
It is not a single statewide number. It is built from the combined state, county and municipal rate that applies at the job-site location, so two identical contracts in two jurisdictions use different factors.
For prime contracting it is also not built on the full contract price. The tax base for the prime contracting classification is sixty-five percent of the gross proceeds of sales or gross income, so the factor for a prime contracting project reflects a rate applied to that reduced base rather than to the gross. A factor taken from a retail table and applied to a contracting receipt produces the wrong number.
Candor does not publish factors or rates. Rates change, and ADOR's agreement with the municipalities provides a period between a city adopting a rate change and its implementation, so any figure published here would go stale silently. The address lookup at AZTaxes.gov establishes the rate for a specific job site.
A.R.S. § 42-5075(B); ADOR Tax Factoring