Cronyism

Florida Governor Rick Scott Proposes $470 Million in Communications Services Tax Relief

florida-capitol

Great news for consumers in Florida: Governor Rick Scott has proposed $470 million in communications services tax relief.  Governor Scott’s proposed budget would reduce the communications services tax for mobile, cable services and non-residential landlines by 39 percent. Furthermore, his proposed budget would also reduce the communications services tax for satellite services by 27 percent. Under the governor’s budget proposal, a family spending an average of $100 a month on cell phone, cable and satellite television services could save about $43 a year.

Currently, Florida’s state and local communications services tax is one of the highest in the nation, with Floridians paying as much as 16.29 percent in state and local communications services taxes.

A recent Florida Department of Revenue survey found that on the local level only Maryland and New York impose a higher local tax on communications services and that Florida’s state tax rate on communications services is the highest in the nation. Finally, the survey found that only California has a larger combined state and local tax rate on communications services. Clearly, Florida’s high state and local taxes on communications services is negatively impacting the state’s economic competitiveness.

According to the ALEC Principles of Taxation, competitiveness is a vital component of a well-structured tax system. Florida’s high communications services tax rate puts the state’s economic competitiveness at a great disadvantage. By reducing the communications services tax rate, Florida’s economy can more effectively compete for more jobs and investments on a national level.  A competitive communications services tax rate is one another step towards more vibrant economic growth in Florida. Most importantly, communications services tax relief means better economic opportunities for families, business owners and entrepreneurs. As Rep. Gaetz, chair of the House Finance and Tax Committee recently explained, “In my committee, no tax is safe. It is the goal of the House of the Representatives to find even more ways to decrease the tax burden on Florida’s families.”

 


In Depth: Cronyism

Cronyism in tax policy stifles innovation, hinders competition and introduces a deep temptation for corruption. The 2014 ALEC Center for State Fiscal Reform study, The Unseen Costs of Tax Cronyism: Favoritism and Foregone Growth, found that in the most recent year in which states published their respective tax expenditure …

+ Cronyism In Depth