Gray Rohrer
Businesses paying rent on commercial property and consumers accustomed to buying during sales tax holidays would be the big winners under the House tax cut package.
The bill (PCB WMC 24-05) would save companies and consumers $728.1 million over the next two fiscal years.
The largest single cut in the bill would be a move to reduce the business rent tax cut to 1.25% starting July 1 and lasting for 12 months. The rate is currently 4.5%, but is slated to drop to 2% in August. The reduction is tied to the state’s unemployment trust fund, which needed to be replenished after it was reduced during the COVID-19 pandemic, but is being refurbished at a faster rate than economists projected. Businesses would save $339.6 million under the move.
Four sales tax holidays are also included in the package, but some are pared back from what lawmakers approved in recent years.
The traditional back-to-school sales tax holiday on school items, clothes and laptops $1,500 or less would last two weeks starting July 29, but a second two-week holiday for the Spring semester that lawmakers approved for the current year isn’t included. Consumers are projected to save $97.3 million.
A sales tax break on a variety of events and outdoor times dubbed “Freedom Summer” has been reduced to “Freedom Month” under the bill. The break applies to tickets to sports events, movies, state parks, museums, ballets, plays, concerts, fairs, festivals and gym memberships.
Camping, fishing, boating and other outdoor supplies and items are included as well, but it would last only through the month of July, instead of for three Summer months as it did last year. Consumers are expected to save $90.4 million.
Two separate disaster preparedness sales tax holidays on hurricane season items such as generators, batteries, tarps and more would run June 1-14 and Aug. 24-Sept. 6. Shoppers are poised to save $80.6 million.
The “tool time” sales tax holiday would also return under the measure and would last one week starting Sept. 1. The sales tax break would apply to hand tools $50 or less, power tools $300 or less, work gloves $25 or less, safety glasses $50 or less, work boots $175 or less, tool belts $100 or less and more. Consumers are projected to save $19.8 million.
Other tax cuts in the bill include a break of up to $10,000 per business for companies that hire disabled workers, which is expected to save $5 million for businesses, and increasing the cap on the Strong Families Tax Credit from $20 million to $40 million, which grants businesses that donate to charities supporting children’s welfare a break on corporate income and other taxes.
Two items that didn’t make it into the package were a one-year cut in insurance premium taxes, which Gov. Ron DeSantis recommended in his budget proposal, and a way to refund the $562 million derived from a defunct Hillsborough County transportation tax. In last year’s tax package, the House preferred to cut sales taxes in Hillsborough County, replenishing the county until the money was depleted, but couldn’t reach an agreement with the Senate on how to dispose of the funds.
The tax cut bill will be heard in the House Ways and Means Committee on Wednesday.
2 comments
Dont Say FLA
February 13, 2024 at 2:47 pm
A tax savings of $728.1M sounds great until you realize it’s split between two billionaires.
Marvin M.
February 13, 2024 at 7:21 pm
I seriously wonder where they get these numbers.
For example, the “tool time” sales tax holiday (one week in Sept.), the article says “Consumers are projected to save $19.8 million.” Sounds great, but …
Using the example from the article, if a person bought one each of the items below during the tax exempt time:
hand tools $50
power tools $300
work gloves $25
safety glasses $50
work boots $175
tool belts $100
They would spend $700 and save 6% tax = $42.
(And of course, most people would be spending less, therefore saving less. Takes a lot of $42 to get to $19.8 million).
Let’s say the average sales tax is 6% in the state. To “save” $19.8 million, people would have to spend $330 million on qualified items in one week of the year. Not over the whole year. Only during ONE WEEK A YEAR!
You buy it any other time, you save nothing. And even during that week, if the power tool you need costs $301 or more, you save nothing.
So the upshot is you personally will only “save” money on these tax holidays if you spend money. Ultimately, who does tax free weeks help? Wealthier people. People with savings, people who have secure regular income, people who can plan to buy during those times rather than “Crap, I need that wrench for my plumbing business now, not six months from now. Guess I’ll have to pay the tax.”
Not saying we shouldn’t do tax free weeks, but to throw out these numbers and suggest it’s “saving” Floridians money is – without explaining the context – deeply fraudulent.
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