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Yahoo
07-04-2025
- Business
- Yahoo
Families, businesses pay most of Florida's sales tax, state analysis shows
A 2021-2022 breakdown shows Florida households accounted for nearly two-thirds of sales tax revenue. (Screenshot via Office of Economic & Demographic Research) Roughly two-thirds of Florida's sales tax proceeds comes from households in the state, the latest analysis prepared by state economists shows, while tourists account for about 16% of the revenue collected. The annual analysis was posted last week by Office of Economic and Demographic Research and comes amid debate over whether to cut sales taxes c or look for ways to cut property taxes paid by homeowners. Florida levies a 6% sales tax on retail, admissions, transient lodgings, and commercial real estate rentals, unless expressly exempted. A House legislative analysis shows that sales tax is projected to account for nearly 74% of the states general revenue in state fiscal year 2024-25. Gov. Ron DeSantis wants to cut property taxes first and has cited the payment of sales taxes by 'tourists' and 'Canadians' as one justification. House Republicans, meanwhile, have touted their proposal to cut more than $5 billion in sales taxes as something that could take effect much sooner. House Speaker Danny Perez wants to trim back the sales tax from 6% to 5.25%. EDR, which reports to the Legislature, estimates the source of sales tax revenue on an annual basis, but because state economists rely on data available from the federal Bureau of Labor Statistics there is a lag, said Amy Baker, coordinator of the office. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX The latest report, which is based on 2021-'22 information, calculates that households paid 65.8% of sales tax collections while businesses were responsible for slightly more than 18%. Tourists accounted for 16.1%. Florida has a very regressive tax structure partly because we are so reliant on sales tax. For Floridians who make less they pay more of their income to taxation. … Any effort to address that imbalance is a positive one in my book.' – Rep. Anna Eskamani These numbers have fluctuated somewhat, and previous reports show that tourists accounted for roughly 13% of sales tax collections in 2016 and 2017. The number of tourists has been on the upswing in recent years, according to Visit Florida, the state's tourism marketing arm. EDR's 2019-20 report estimated that more than 76% of sales taxes collected in that fiscal year came from households compared to 11.9% from tourists. When discussing his own plan to lower property taxes, DeSantis argued that a cut in sales taxes would allow 'relief for foreigners. It allows relief for visitors and part-time residents. I think that tax relief needs to be focused on Floridians.' The governor wants legislators to give an estimated 5.1 million residents who have a homestead exemption on their property taxes a rebate averaging $1,000 in December. That would be followed by a 2026 ballot proposal to enact a permanent tax cut. The House, however, is moving ahead with its sales tax plan. The bill cleared its first committee unanimously on Wednesday with both Democrats and Republicans on the Ways and Means Committee praising the idea. 'Florida has a very regressive tax structure partly because we are so reliant on sales tax,' said Rep. Anna Eskamani, a Democrat from Orlando. 'For Floridians who make less they pay more of their income to taxation. … Any effort to address that imbalance is a positive one in my book.' SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
16-03-2025
- Business
- Yahoo
Florida revenue estimates up amid ‘uncertainty', according to economist
Florida economists Friday warned that 'uncertainty exists' as they increased general-revenue projections that lawmakers will use in negotiating a new state budget. A panel of economists known as the Revenue Estimating Conference updated general-revenue projections, which were last issued in August, by about $1.3 billion for the current fiscal year and next year. But in an executive summary of its report, the panel pointed to 'weaker' state and national economic variables and said the 'forecasting environment is considerably less stable over the short run than it was in the summer. Further economic uncertainty exists from this point forward.' Economist Amy Baker, coordinator of the Legislature's Office of Economic & Demographic Research, said the new revenue forecast comes with 'a strong caveat' that the 'greatest risks going forward are all to the downside.' 'There's a lot of uncertainty on how things are going to unfold, both at the federal level, and that includes not only new policies that are being put into place, but also, what is the Federal Reserve going to do next,' Baker said. The Revenue Estimating Conference meets periodically throughout the year to update projections of general revenue, which includes such things as sales taxes and plays a critical role in funding schools, health programs and prisons. Lawmakers will use Friday's estimates in crafting the fiscal year 2025-2026 budget, which will take effect July 1. Legislative leaders have repeatedly said spending in the budget won't be as robust in past years, in part because federal COVID-19 pandemic money is no longer available. In August, Baker said some economic uncertainty remained about consumer saving levels and global issues, such as conflicts in the Middle East that could have a spillover effect on oil and gas prices. Now, concerns include the Trump administration's decisions to cut government operations and impose tariffs on traditional trading partners. The state economists added $768.3 million to projected revenue for the current fiscal year, which started July 1, and $503.5 million for the 2025-2026 fiscal year. The gains are based on sales-tax revenue that has mostly come in higher than anticipated in August and higher-than-expected earnings on state investments. 'I think uncertainty in and of itself causes people to, you know, kind of hunker down,' Baker said. 'In addition to that, you know a lot of folks have money that's at least tangentially in the stock market. Retirement bonds, 401(k)s. So, they watch those balances. They feel those balances coming down. They know that it's a time of uncertainty. They feel less wealthy. They feel less better off as a result of that.' The sales-tax estimate was increased by $510 million for this fiscal year. An increase of $385.4 million was added to the forecast for 2025-2026. Meanwhile, projected revenue from corporate income taxes faced the biggest reduction --- $221.8 million --- over the two years. The state's figures, in part, reflected survey numbers by the University of Michigan, which on Friday indicated national consumer sentiment reached its lowest reading in over two years. 'The sentiment numbers are the latest sign of worry caused by (President Donald) Trump's trade wars alongside sustained drops in the stock market as investors react to the fallout from higher tariffs on China, Mexico and Canada, and on steel and aluminum from U.S. allies,' Joanne Hsu, director of the survey, said in a news release. 'There's also the prospect of more duties on countries across the globe.' Last week, the University of Florida's Bureau of Economic and Business Research found a 'sharp' decline in consumer confidence among Floridians after three consecutive months of increases following the November presidential election. Click here to download our free news, weather and smart TV apps. And click here to stream Channel 9 Eyewitness News live.
