Florida tax holidays won’t match 2023’s, but businesses might get another break

Florida tax holidays won’t match 2023’s, but businesses might get another break

TALLAHASSEE — Florida lawmakers are pondering whether to cut a tax on commercial leases again this year as they scale back sales-tax holidays for consumers.

The House Ways & Means Committee on Thursday reviewed tax-cut concepts, including a possible reduction in the business lease tax, as the House and Senate prepare in the coming weeks to negotiate a tax package.

But committee Chairman Stan McClain, R-Ocala, agreed with Senate Appropriations Chairman Doug Broxson’s assessment that the final tax-cut package won’t reach a $1.3 billion total in the current fiscal year.

“It won’t be as robust,” McClain said after the committee meeting when asked a question using the same phrase.

McClain said his committee will roll out a proposal next week that could include shorter sales-tax holidays than last year, when the state offered two 14-day tax holidays for back-to-school items, two 14-day tax holidays for disaster-preparedness supplies, a three-month tax holiday for recreational items and activities and a seven-day tax holiday for such things as tools.

“All of that’s in play,” McClain said. “Again, we have a certain amount of money that we think we can use for tax packaging.”

McClain didn’t say what the overall amount could be.

House and Senate leaders will negotiate a budget for the 2024-2025 fiscal year and a linked tax package before the scheduled March 8 end of the annual legislative session.

On Wednesday, Broxson, R-Gulf Breeze, said the final budget will include paying off debt and socking away record reserves but probably will result in tax holidays that are “more restricted than last year.”

McClain’s committee on Thursday looked at several proposals, including making a deeper cut in the lease tax, which is expected to fall from 4.5% to 2% in June.

Each 1 percentage point reduction would cut revenue to the state by about $360 million a year, McClain said.

The state has imposed the lease tax since 1969, and business groups have sought for years to whittle or eliminate it.

As an interim step during the 2023 session, lawmakers reduced the tax from 5.5% to 4.5% on July 1, the start of the current fiscal year.

The House committee also looked at limiting the number of years local tourist-development taxes could be imposed and providing up to $10,000 in credits against corporate income taxes for companies that hire people with disabilities.

Rep. Anna Eskamani, D-Orlando, said she’d like the credits to also apply to small businesses, many of which do not pay corporate income taxes.

“Right now, I think Publix and Disney would be the biggest beneficiaries,” Eskamani said. “And I just feel like it would be awesome to incentivize small businesses to benefit, too.”

 

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