When the Florida legislature convenes in an extended regular session the week of May 12th, there will be a lot of hot-button budgetary issues on the table. Probably the closest watched will be the battle over tax relief for Floridians.
The tax relief issue has broad support, but the real debate is on how to do it. So far, the leading contender is a House-backed plan to cut sales taxes from 6% to 5.25%. Proponents of the House plan feel that a sales tax cut is the most cost-effective way to deliver some tax relief to Floridians, but many see the bipartisan plan as largely symbolic.
Governor DeSantis says he will have none of it. He has assured legislators that the bill would be dead on arrival should it reach his desk. Why? Because sales taxes are exactly what DeSantis will need to enact substantial relief for homeowners under his proposed plan.
DeSantis is seeking to place an amendment on the 2026 ballot that would entirely eliminate Florida property taxes for homeowners. Under DeSantis’s plan, millage rates would be phased out, replacing the lost revenue with tourism and consumption taxes. DeSantis said, “This is what it means to be a low tax state.” The DeSantis plan would also include a $1000 tax rebate to property owners.
DeSantis acknowledges that his request will be an uphill battle in the legislature. “None of the Senators support it. Honestly, a lot of the House members don’t support it either, but the way the House is run, you know, they threaten you, they take away your committee, they do all that.”, DeSantis said.
Local governments find DeSantis’s plan problematic, citing concerns about having to cut services and losing local autonomy. Property taxes are a major source of revenue for local governments, funding essential services like schools, public safety, and infrastructure. A reduction or elimination of this revenue would create a significant financial gap.
Even so, the Desantis plan is not without supporters. Republican Senator Blaise Ingoglia of Spring Hill says the Governor for being “ahead of the curve” on property taxes. Ingoglia notes that citizens have taken note of the massive increases in the general budget of some cities, and says citizens are in “revolt”. Ingoglia is a potential Chief Financial Officer appointee and has a history of being a strong DeSantis supporter.
According to the Florida Policy Institute Tax Policy Center explains, the first goal of the property tax is to raise revenue for local governments to finance schools, roads, parks, police protection, and firefighting services. The property tax meets this goal by supporting nearly one-third of local government operations across the United States. In Florida, the tax supports nearly 28 percent of local government services.
Right now, Florida has the money to provide substantial tax relief. But like all things government, that money will be gone within a year unless the state’s proposed spending is curtailed. Florida is projecting a $2.1 billion budget surplus for the upcoming fiscal year, FY 2025-26, but this could quickly turn into a deficit if spending continues at its current pace. By FY 2027-28, a deficit of $6.9 billion is projected without intervention. The state also has substantial unallocated general revenue and Budget Stabilization Fund reserves.
Florida Tax Watch noted in a March report that the State’s recent tax collections exceeded estimates, noting that, although year-over-year revenue growth is expected to be modest at 1.9 percent, substantial gains from sales tax and investment earnings have significantly boosted the forecast. According to the March report, the increased revenues added $1.3 billion to the money available to the new state budget.
