March 17 • 10:30 p.m.

One of the biggest tax cut proposal in state history is headed for the November ballot.

Today the Florida Tax and Budget Reform Commission (TBRC) passed a proposal spearheaded by commission member John McKay, a former state legislator, to eliminate most of the portion of local property taxes that goes to schools, and require the Legislature to make up an estimated $9.5 billion in lost revenue by imposing a penny increase in the state sales tax, eliminating some sales tax exemptions (primarily on goods) and cutting the state budget.

This proposal does NOT include a mandatory services tax. FAR and other business groups successfully removed the services tax provision several weeks ago.
 
The proposal also includes a 5 percent assessment cap on non-homestead property -- a reduction from the 10 percent provided by Amendment 1 this January.

CP 2 is expected to reduce property taxes by an average of 25 percent for ALL property types. The actual savings will vary by city and county.

FAR supports lower property taxes and non-homestead assessment caps. FAR, like other business groups, is concerned that the Legislature may have to consider taxing services or other tax increases to make up the very large amount of money the RLE represents.

The commission also “temporarily passed” other proposals of interest to Realtors:

CP 21 provides a 25 percent “super exemption” to all residential properties, including second homes and rentals.

FAR testified in favor of the super exemption, which is in addition to the $50,000 homestead exemption property owners currently enjoy, as it will enable recent and first-time homebuyers to benefit from property tax savings immediately.

SR 13 amends current law to revise the factors that a property appraiser must consider in deriving just valuation of real and tangible property.  The revised factors require a property appraiser to consider the legally permissible use of property, zoning changes, concurrency requirements, permits necessary to achieve the highest and best use of property, and physical deterioration and functional obsolescence of property. The recommendation provides that it will apply to assessments beginning in 2009.  SR 13 was amended by commissioners to include very similar language to that of HB 1283 by Rep. Dean Cannon (R-Winter Park). As it now reads, SR 13 changes the presumption of correctness the property appraiser currently enjoys during Value Adjustment Board hearings to “the preponderance of evidence.” 

FAR supports this change and testified that a similar constitutional proposal, CP 42, be placed on the November ballot if the Legislature fails to act on the TBRC recommendation.
 
You can read more about these proposals at the TBRC Web site.