More of $1 billion online sales tax earmarked to another business tax cut

TALLAHASSEE — Florida businesses would get a second tax reduction as lawmakers move toward requiring out-of-state retailers to collect from Florida consumers up to $1 billion a year in sales taxes on purchases they make online, under a deal announced Monday by House and Senate leaders.

The House Commerce Committee backed a measure (HB 15) on Monday that would require out-of-state retailers to collect and remit the sales taxes, with the anticipated $1 billion a year in revenue now proposed to go toward replenishing the state’s Unemployment Compensation Trust Fund and to subsequently make a major cut in a tax on commercial rent.

The commercial rent tax, long a target of business lobbying groups, was added to the House proposal Monday. The Senate last week passed a version (SB 50) that required the additional money to go to the unemployment fund, which has been largely depleted during the COVID-19 pandemic. The move would negate the need for what was supposed to be an automatic tax increase on businesses to rebuild the fund.

Proposals in past years to require out-ofstate retailers to collect sales taxes have failed because of concerns that it could be viewed as a tax increase on Florida consumers. However, House Commerce Committee Chairman Blaise Ingoglia, R-Spring Hill, said the amended bill can be viewed as a $1 billion tax cut for businesses.

“Since we’re taking the money and we’re offsetting and we’re giving it back in forms of tax cuts, it doesn’t grow government, it’s meant to grow the economy,” Ingoglia said.

As the House committee voted Monday to advance its version of the bill, Simpson and Sprowls announced the additional sales-tax money also would bring down the commercial rent tax from 5.5% to 2% after the unemployment trust fund is replenished.

The Senate on Thursday voted 30-10 on its version of the sales-tax proposal (SB 50), which was linked to an earlier agreement between Senate President Wilton Simpson and House Speaker Chris Sprowls to use the money to replenish the unemployment trust fund.

Simpson, R-Trilby, said the amended proposal will “lead to thousands of new high-wage jobs for Floridians.”

Economists have estimated that the proposal to require out-of-state retailers to collect sales taxes could generate $973.6 million in the upcoming 2021-2022 fiscal year and $1.08 billion in each following year, according to the House and Senate.

Democrats in Monday’s committee meeting were unable to change the bill to address state unemployment benefits, which at $275 a week are among the lowest in the nation. However, they supported the overall proposal.

“This amendment is only supporting small business owners and the amendments that I offered up previously would have supported workers,” said Rep. Angie Nixon, a Jacksonville Democrat who noted she is a small business owner. “I just want to put that on record.”

If the revised bill is approved by the full House, it would need to go to the Senate for a final vote.