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Governor: Reduce commercial lease tax by $100M


 

Governor's budget proposal

Florida Realtors’ commercial members were in attendance as Gov. Rick Scott announced his support for a reduction in the state’s sales tax on commercial leases. Watch video.

ORLANDO, Fla. – Jan. 28, 2014 – Florida Gov. Rick Scott joined commercial Realtors and other business owners today to announce that his proposed state budget, which will be released tomorrow, includes $100 million to support a reduction in the state’s sales tax on commercial leases.

“As governor, my mission is to make Florida the No. 1 place in the nation to live, work and play,” Scott told the crowd of more than 50 area businesspersons gathered at Conway Ace Hardware in Orlando. “Florida is the only state that imposes a 6 percent sales tax on commercial leases. That’s why I’m proud to announce today that, as part of my ‘It’s Your Money Tax Cut Budget,’ we propose a $100 million reduction in the sales tax on commercial rent.”

The economic impact of a $100 million reduction in this tax would provide a $500 million value to Floridians in terms of jobs and economic activity, research indicates. Currently, businesses in the state pay a tax on commercial rent and other lease-related charges, such as insurance premiums, property taxes and common-area maintenance fees for such things as landscaping, janitorial services and building repairs.

Florida Realtors 2014 President Sherri Meadows was on-hand for the governor’s announcement.

“Most companies relocating to the Sunshine State are surprised to learn that Florida charges a 6 percent sales tax on commercial real estate leases,” said Meadows, CEO and team leader, Keller Williams, with market centers in Gainesville, Ocala and the Villages. “For Florida to be competitive with other states and online retailers, and considered pro-business by prospective employers and companies seeking to relocate, we must reduce – and eventually eliminate – the sales tax on commercial leases. Doing so will create jobs and is critical to our state’s economic growth and development. We appreciate Governor Scott for recognizing the importance of reducing this tax.”

Two bills filed for the 2014 Florida legislative session would begin a phase out of the tax: SB 176 by Sen. Dorothy Hukill (R-Port Orange) and HB 11 by Rep. Greg Steube (R-Bradenton) would lower the rate from 6 percent to 5 percent. Florida Realtors, NAIOP Commercial Real Estate Development Association, the Florida Chamber of Commerce and other business groups support the initiatives.

© 2014 Florida Realtors®

Related Topics: Commercial, Florida Legislature