As lawmakers haggle over the budget in the final stretch of the session, they’ll be deciding whether cell phones deserve a tax break or TV producers, gym memberships and low income neighborhoods do.
With about $500 million to offer in tax and fee breaks in next year's $75 billion budget, the House and Senate have already agreed on a major chunk: reducing about $395 million in vehicle registration fees.
Gov. Rick Scott has already signed that into law.
What about the rest?
Both chambers have pretty much already agreed on a tax holiday on Aug. 1-3 for “back-to-school” sales. It includes no sales tax on clothing less than $100, school supplies that are more than $15 but less than $100, and the first $750 spent on personal computer equipment, which is estimated to cost the state $32.3 million; June 1-12 “hurricane preparedness” holiday for supplies like fuel tanks, flash lights, first aid kits and reusable ice, which would cost the state $3 million.
Both chambers are taking next week off, so that will give them about two weeks to hash out the remaining differences.
What are they?
During Thursday’s Senate Appropriation’s meeting, Sen. Dorothy Hukill, R-Port Orange, proposed an amendment that included a $71.1 million reduction of communications services tax, which is a state tax rate of 6.65 percent levied on cable, phone services, and satellite TV.
But then three amendments were approved, all by voice vote, that reduced the size of the cut.
Sen. Tom Lee, R-Brandon, offered an amendment that allowed companies to recover the tax paid on bad debt charged to credit cards, which reduced the cut by $4.4 million. Sen. Rob Bradley, R-Fleming Island, got his amendment approved that reduces the premium on bail bonds by $700,000; and Sen. Bill Galvano, R-Bradenton, got his his amendment approved that redefined certain cellular services and prepaid services, that reduced the cut by another $1.4 million and $5.7 million from the state’s construction and maintenance fund for schools and universities.
All three amendments reduced the size of the cut by $6.5 million, so it’s now a proposed reduction of $64.6 million.
In addition, Hukill’s amendment offered a batch of tax refunds for sports franchises, including a $166,000-a-month tax refund for the the Daytona International Speedway.
Democrats expressed concern that cuts to the communications services tax, which affect almost all consumers, were being replaced for business tax cuts that didn't have as widespread of impact
Sen. Gwen Margolis, D-Miami, said she wished Thursday’s tax cut plan was vetted earlier in the process.
“I’m frankly disappointed because the people expect to get some money back,” Margolis said. “And I think we’re whittling down the people’s money for a handful of special interest that might deserve it, might not deserve it.”
Sen. Arthenia Joyner, D-Tampa, said she regretted voting for the amendments because the cuts in the communications tax, which she estimated would save her about $68 on her three cell phones, should have been as big as possible.
But Senate Appropriations Chairman Joe Negron, R-Palm City, pointed out that of the whole $500 million tax cut most of it is going to regular people: $395M of tax cut goes to constituents through vehicle tax, though businesses with large fleets are the big winners.
“If the goal is to get broad-based tax relief to as many people as possible, I think that this proposal does that,” Negron said.
But the Senate plan ditched most of the House’s tax package.
While the Senate kept the “back-to-school” tax holiday, it didn’t keep the House’s three others: June 1-12 “hurricane preparedness” holiday for supplies like fuel tanks, flash lights, first aid kits and reusable ice, which would cost the state $3 million; Sept. 1-8 tax holiday on physical fitness facilities, which would cost $4.1 million; and Sept. 19- 21 tax holiday on the first $1,500 spent on energy-efficient products, ENERGY STAR or WaterSense products specifically, which would cost $1.7 million.
The Senate didn’t include other House tax cuts, like $200,000 for bike helmets; $3.3 million for cement mixers; $2 million for child restraints and booster seats in motor vehicles; $8.8 million in a decrease in the corporate income tax; an extension of a $14 million tax break for businesses contributing to affordable housing and other community redevelopment projects; $20 million in tax breaks to encourage to encourage TV show production in Florida, an expansion of about $50 million New Markets Tax Credit program, which invests in low income neighborhoods.
Afterward, Negron said he was confident that the two chambers will come to an accord.
“The big picture for me is we are going to reduce taxes and fees by another $105 million and we'll simply come together on the best way to do that," Negron said.