Eliminating Property Tax in Florida?

It is early, but there is a proposal that was heard this week in a House committee that would start the ball rolling toward eliminating property taxes in Florida. “This bill (HB 1371) is about one thing. It's about starting down the road toward phasing out and eliminating Florida's property tax," said Rep. Ryan Chamberlin, R-Ocala. “We all simply rent it from the state, and as long as we pay those rents, then we can use the property we hold a deed for,” Chamberlain said. “This is not a tax; it is slavery.”

Florida already has no state income tax. If property taxes go away, that money must be made up somehow. Rep. Joe Casello, D-Boynton Beach, noted that likely means a significant increase in sales taxes. “So, by eliminating the property tax which all municipalities count on, we could possibly have one of the highest sales taxes in the nation to compensate for that loss.” Casello conjected. Chamberlin responded, "I believe this is going to actually lower the overall taxes on most Floridians if we do it properly. But the truth is, there will be another tax to replace this property tax to eliminate us renting our property forever.”

Rep. Rick Roth, R-West Palm Beach, called the measure an affordable housing bill. "If we can change the way we collect taxes in the state of Florida and not tax property, I think we'll have more people being able to own property," said Roth. He suggested rent would also go down since rental property owners wouldn't be paying property taxes.

Rep. Susan Valdés, D-Tampa, called it an interesting idea. But she’s concerned about what a potential jump in the sales tax rate would do to low wage workers. “Let's say the taxation rate, I'm just gonna throw a number out there, is 30%," Valdés said. "For a person that works minimum wage, that's 30 cents to every dollar. That's a lot.”

It’s been a while, but the notion of eliminating property taxes has come up in the Florida Legislature before, and it has never gotten far. In fact, no state has banned property taxes.

I see flaws in multiple places with property tax elimination, but it is noteworthy to see that the Florida lawmakers are thinking outside the box. If this makes its way forward, the House proposal would require the results of the study to be submitted to lawmakers by February 1st of next year.

The idea of eliminating property taxes in Florida isn’t new. In 2007, Florida House GOP lawmakers pursued the idea under then, House speaker Marco Rubio, to eliminate property taxes on homesteaded property and to replace some of the lost revenue with a 2.5 percent state sales tax increase.