Because the City of Phoenix has outspent its revenue, the city is looking at ways to try to make up for the budget shortfall. 

The city is blaming their wreckless spending on "decisions made at the State level including the elimination of residential rental sales tax and the implementation of a flat income tax" on its website here: https://www.phoenix.gov/newsroom/city-manager/3325

From the article, "[The City is] looking to increase increase transaction privilege tax (TPT) and use tax (sales taxes) by up to 0.5% (half a percentage point). This notice does not necessarily mean taxes will increase, but instead gives the Council and the community time to consider potential options to balance the budget. The Council would have to vote to increase taxes, something that would not happen for at least 60 days to give community members time to share their opinions about any changes. The Council is currently scheduled to consider the increase at the March 18, 2025, Phoenix City Council meeting. If Council approved any change, it would take effect on July 1, 2025."

Here is a good video summarizing the Goldwater Institute's lawsuit against the City of Phoenix: https://www.instagram.com/reel/DG90o3sxKXR/?igsh=MTUwaWhmMG94azYxbw%3D%3D

Goldwater is saying the City is raising taxes on services, which is unconstitutional. 

Here is their article on it: https://www.goldwaterinstitute.org/phoenix-cant-balance-the-budget-theyre-breaking-the-law-to-tax-you-instead/