[This letter concerning the reduction of the Florida state sales tax on commercial lease agreements was submitted to Florida state legislators in April].
Dear Florida Legislator,
It was a pleasure to meet with you and your staff for the “Great American Realtor Days” in Tallahassee on March 19th. We sincerely appreciate your hospitality and precious time. As you know, Florida Realtors is the largest trade association in the state with more than 127,000 members. In addition, we represent thousands of small, medium and large businesses throughout the state. Every business that leases commercial property in Florida must pay the state sales tax of 6%. Florida is the only state in the nation that charges such a tax. The Florida Realtors as well as the business community aims to reduce and/or eliminate this unfair tax.
To our understanding, you are aware of the Realtors’ plight this year to make a nominal reduction to the sales tax on rent paid or commercial properties. We respect your decision either way, however below are a few reasons why you should support Realtors and Florida businesses on this issue:
• Since Florida is the only state in the USA that levies such a tax, other competing states are using this to our disadvantage. The Economic Development Organizations (EDO’S) of other states try to persuade businesses against locating and/or expanding to Florida. There is a fierce competition to create jobs across the country. Higher taxes do not help us recruit new employment opportunities. According to a 2012 survey by Site Selection, Florida ranks 36th in attracting new businesses from a tax perspective.
• If we reduce the overall occupancy costs then businesses may hire more employees; invest in training and education of employees; offer more healthcare and retirement benefits; open additional locations; and more.
• One of the most menacing facts about doing business in Florida is that the sales tax is charged on top of property taxes. This is double taxation. This is simply not fair.
• If and when the entire 6% sales tax is repealed, over 185,000 new employment opportunities would occur along with an estimated $20,000,000,000 positive economic impact. This would be five times the revenue impact according to Economic Impacts of Sales Tax Reduction on Commercial Property Leases by Fishkind & Associates, August 2013.
We understand that the revenue generated from the tax is about $1.2B. However, please keep in mind, that in addition to this tax, businesses are paying many, many other taxes, permits, fees, tolls, etc. to national, state, county and local taxing authorities. The feedback that we receive from our mutual customers (i.e. the people of Florida) is that they are simply being over taxed and over regulated. Please help support Florida Realtors and businesses by making at least a nominal reduction to the sales tax.
Thank you very much for your consideration.
CC: Paul Cauchi, Sr. Vice President of Commercial, Miami Assoc. of Realtors
Bruno Lopes, Vice President of Government Affairs & Housing, Miami Assoc. of Realtors
John Sebree, Senior Vice President of Public Policy | Florida Realtors