House Lawmakers Unveil Tax Package
The House is trumpeting its tax package this week, and Wednesday, Finance and Tax Committee chair Matt Gaetz ran through the proposals. But the path ahead is far from certain with unresolved issues like healthcare looming.
In a press conference Tuesday, Rep. Matt Gaetz (R-Fort Walton Beach) unveiled the House tax package.
“This year I will ask the legislature to pass a $690 million tax cut benefitting the people of Florida,” Gaetz said.
There’s even a hashtag: #NoTaxIsSafe for those of you so inclined.
In committee Wednesday, Gaetz gave a rundown of the House’s proposals. There’s about 20 of them—some familiar, some new, some broad and some focused.
Many are familiar with the back-to-school sales tax holiday, and Rep. Ray Rodrigues (R-Fort Meyers) is sponsoring its return again this year. But there are other limited time only tax breaks, too. Rep. Frank Artiles (R- Miami) wants to waive sales tax for camping supplies on July 4, and fellow Rep. Jay Fant (R-Jacksonville) wants to cut them for Small Business Saturday. That’s the holiday invented in reaction to Black Friday—another made up holiday.
There’s also two proposals related to books, Rep. Jared Moskowitz (D- Coral Springs) describes one targeted at the state’s million or so college students.
“By getting rid of the sales tax on textbooks, we can save those students $300 over the life of their four year courses,” Moskowitz says. “So, as I’ve often said, some tax cuts are better than others; this is my favorite of the package.”
The other is aimed at grade school students.
“Kids are saving up their lunch money or grabbing for a wrinkled dollar or two at the bottom of a book bag to buy a book at a book fair,” Gaetz says. “I didn’t think the state of Florida ought to be taking $2.3 million away from the students that are buying books at book fairs, and so we had proposed to eliminate that tax in the package.”
“Anybody want to tax book fairs?” Gaetz asks.
He also wants to cut sales tax for concessions at school events like football games and the tax on aviation fuel at the state’s flight schools. Also under the plan, farmers will get sales tax breaks for irrigation equipment, and metal recyclers will save on equipment, as well. And there’s vet-friendly taxes too—vets returning with cars purchased abroad won’t face a penalty, and they’ll have reduced property rates while they’re deployed. Widows and the disabled would also get a property tax cut under the House plan.
“Next issue deals with pear cider, which I think we’ve all earned by now,” Gaetz jokes.
Currently, he explains, pear cider is taxed like wine.
“So we just add the word ‘pear’ to statute so that there is equity, I would say parity,” Gaetz puns to general groans and laughter.
But none of these are the big ticket items. Gov. Rick Scott wants to cut a tax on communications services like cell phones and cable TV—to the tune of almost half a billion dollars. Sen. Dorothy Hukill (R-Port Orange) is moving the measure steadily through the Senate, but the bill has yet to appear in the House.
Part of that has to do with calls from some House members to cut Florida’s tax on commercial rent.
“I mean looking forward to next year, do you perceive the opportunity to be able to do more on the commercial sales tax lease?” Rep. Jennifer Sullivan (R-Eustis) asks.
Gaetz explains Florida is the only state in the region that charges a tax on commercial rent, and he is planning on cutting it. Just incrementally.
“What I’m trying to signal to the committee and the Legislature is that each year we have to take a bite,” Gaetz says. “You know if it’s a small bite or a big bite will largely depend on how the economy is doing in the state.”
Under Gaetz’s proposal, the six percent rate will drop to five point eight. All told, the House is offering $690 million in tax cuts.
But compare that to the Senate.
“Our F&T, Finance and Tax chair, Senator Hukill has passed over $800 million in tax cuts,” Sen. Tom Lee (R-Brandon) says.
Lee chairs the Senate Appropriations committee. So why the discrepancy? Well, the Senate has put forward a much larger budget. That’s because they’re expecting federal healthcare funding from Medicaid expansion and an extension of the low-income pool, or LIP, program.
But House leadership opposes expanding Medicaid and they’re doubtful the feds will continue the lip program. Untangling this knot of philosophical and financial positions will have to wait for the conference process, and meanwhile negotiations on extending LIP seem no closer to a resolution.