Business Rent Tax Stifles Florida's Economic Future

Letter from Pat Neal

BY PAT NEAL SRQ DAILY SATURDAY PERSPECTIVES EDITION SATURDAY APR 8, 2017

The business rent tax is the only state-sanctioned sales tax on commercial leases in the entire country and Florida is the not-so-proud holder of that title. Not even tax-happy havens like California and New York impose this state tax on its businesses. Due to this burdensome tax, Florida businesses shell out more than $1.7 billion dollars every year to the state. As a result, our state economy dramatically suffers in the form of suppressed job growth and economic activity.

Luckily, Gov. Rick Scott is committed to cutting this tax on hardworking small business owners and budding entrepreneurs. The governor has repeatedly made cutting or abolishing this tax one of his top priorities for numerous years as part of his commitment to creating jobs for Florida families. Recently, he has hit the road advocating for a 25 percent cut in the tax—a move that could save Florida businesses more than $400 million per year and reduce prices for Florida consumers.

The business rent tax places a disproportionate burden on small businesses and startups that do not have the capital to purchase bigger office space, hire new employees or expand to other locations. All of this creates a chilling effect on many of Florida’s more than two million small businesses.

Florida TaxWatch’s research has shown that this rent tax presents an impediment to the success of the state’s businesses, and TaxWatch’s long-standing recommendation has been that Florida’s policymakers should take efforts towards reducing or eliminating this tax.

The fairness and competitiveness of our tax structure is paramount to Florida’s continued success. If we want to continue to be recognized as the top place in the country for business, we must promote incentive programs like Enterprise Florida and commit to reduce or eliminate the business rent tax. This is the one area where Florida cannot afford to be unique.

Pat Neal is a former state senator and president of Neal Communities.

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