Everyone loves a tax cut, right?


  • October 10, 2015
  • /   Jim Turner
  • /   economy

TALLAHASSEE — The Manufacturers Association of Florida wants lawmakers to sign a "pledge" that they will endorse Gov. Rick Scott's effort to permanently eliminate a tax on machinery and equipment.

But even in a Legislature filled with lawmakers who profess to be driven to cut taxes, getting names on the dotted line might not be so easy.

Senate President Andy Gardiner, an Orlando Republican who has targeted $250 million as a starting point next year for discussions on a tax-cut package, is open to the idea of including the manufacturing tax cut in the package, spokeswoman Katie Betta said in an email.

However, Betta added, "during his 16 years in the Legislature, President Gardiner's general policy has been not to sign pledges."

House Speaker Steve Crisafulli, R-Merritt Island, was less direct when asked if he would sign the association's requested pledge.

"The House is committed to providing meaningful tax relief to Florida families and businesses," Crisafulli said in a prepared statement. "We welcome any and all ideas to put more money back into the hands of Florida taxpayers. Chairman (Matt) Gaetz and the Finance & Tax Committee will be putting together the House's tax cut proposal. I encourage members to work with Chair Gaetz on ideas they feel will best lower taxes for the most Floridians."

Lawmakers in 2013 approved a three-year moratorium on the sales tax on manufacturing machinery and equipment, but the tax is scheduled to return in 2017. Scott last year projected that companies would have to pay $142.5 million annually if the tax is again collected.

The association last week circulated a pledge for Florida lawmakers to sign by Dec. 1 declaring opposition to a revival of the tax.

In January, Lance Cook, outside sales and marketing manager of Pensacola’s Rubber & Specialities Inc., spoke in favor of making the tax exemption permanent at the Greater Pensacola Chamber of Commerce’s legislative luncheon.

Cook said the measure simplified the application process for the exemption, “but (it’s) not simple,” Cook said. He noted two businesses — Advanced Sawmill Machinery in Holt and TPR in Milton — who still found the application process challenging.

Read more about that here.

Nancy Stephens, the association's executive director, said the intent of issuing the pledge is to raise awareness about the tax, as the issue is going to have to compete with numerous other tax-cut proposals in 2016.

SWAPPING PROPERTY TAX FOR SALES TAX

A House committee is looking at ways to replace property taxes with a higher state sales tax.

The House Finance & Tax Committee on Wednesday started to explore scenarios that would shift the tax burden to shoppers by eliminating or reducing the number of Floridians paying property taxes.

Committee Chairman Matt Gaetz, R-Fort Walton Beach, said any scenarios will need "many hours to fine tune," with economists expected to address the committee before anything is advanced for the 2016 legislative session.

Several Democrats on the committee quickly expressed concerns that the swap would disproportionately hurt poor people, who spend greater portions of their incomes on sales taxes than wealthier residents do.

"Poor folks spend eight times more of their income on sales tax that wealthy or folks who are not in poverty," said Rep. Randolph Bracy, D-Orlando. "Would I want my property tax lowered? Absolutely. But shifting it to sales tax concerns me."

If the state eliminated all property taxes, committee records indicate the state's sales tax would have to go from 6 percent to 12.72 percent to cover existing state, local, school and special district expenses.

The committee is expected to also review the impact on state and local revenue before any measure advances, Gaetz said.

Rep. Bob Cortes, R-Altamonte Springs, said the committee will need to look at the potential impact on local governments along the Georgia and Alabama lines, noting there may be an increase in Floridians opting to cross the state lines to do their shopping.

Seeking to address Democratic concerns, Rep. Matt Caldwell, R-North Fort Myers, said poor people could avoid taxes since the state fully exempts most foods, rent and medicines from the sales tax.

"Under this type of proposal, if you are truly poor you can actually live tax free in the state of Florida," Caldwell said. "If you are only buying the things you need, and you no longer have to pay any property tax, you can live exclusively tax free in the state of Florida."

Rep. Hazel Rogers, D-Lauderdale Lakes, said she hopes as the committee delves further into any of the concepts, it also considers the impacts of a higher sales taxes on renters and seniors on fixed incomes.

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