Phasing Out Tax on Commercial Leases Key for Fla. Business Expansion
ORLANDO, Fla., Feb. 6, 2013 – As lawmakers head to Tallahassee to kick off the 2013 Florida Legislature in a few weeks, Realtors across the state are ready to address major issues of concern to all Floridians including: funding for affordable housing; eliminating a tax on commercial rents; sustainable and affordable property insurance; and the state’s judicial foreclosure process.
“Homeownership is called the American Dream for a reason: Like people all across our great country, many Floridians aspire to own their own home not just for the financial and social benefits, but also because it gives us a sense of belonging, a sense of community and a place to raise our families,” says 2013 Florida Realtors President Dean Asher, broker-owner with Don Asher & Associates Inc. in Orlando. “Putting money back into the state’s affordable housing trust funds is sorely needed to help people realize their homeownership dreams.
“Florida Realtors will support legislation that promotes economic development and helps strengthen our state’s economic recovery,” Asher adds. “Housing creates jobs and jobs create housing opportunities. A stable and growing real estate market is crucial to getting our citizens back to work, revitalizing our communities and renewing the promise of Florida’s future.”
The 118,000-members of Florida Realtors understand the importance of making their voices heard as lawmakers take up the challenge of helping Florida grow and prosper, while continuing to protect the state’s quality of life for residents and visitors now and in the future, says John Sebree, Florida Realtors’ senior vice president of public policy.
Tax on commercial leases
Florida is the only state that taxes commercial rents, Sebree says. Commercial tenants pay a 6 percent sales tax on rent, and local governments may charge an additional discretionary sales surtax.
He says, “In an effort to make Florida more competitive, the Legislature really needs to phase out this tax. Adding sales tax to rent can be the difference in whether a small business can stay in business. Six percent is often within the margin. Since Florida is the only state in the nation that charges this additional tax, it is very anti-competitive. We’re already hearing from businesses who say they would expand if this tax were to be eliminated or phased out.”
Judicial foreclosure process
The foreclosure crisis has impacted Florida’s economy and negatively affected the judicial branch in terms of both funding and caseload, Sebree points out. Foreclosing on a mortgage in Florida is a long process, with 676 days being the average length of time between the first foreclosure filing and bank repossession; the national average is 318 days.
“There is so much uncertainty on the part of those who have gone through a foreclosure,” he adds, noting the bank can currently come after them for a deficiency judgment for up to five years unless an agreement to forgive the debt is reached. “Florida Realtors is working with the sponsor of legislation that would shorten that time frame to one year. This and other pro-consumer reforms will finally help Florida move beyond the crisis that has prevented our state from a full-fledged real estate recovery.”
Property insurance remains a major priority for Florida’s Realtors, just as it is for all Florida full- or part-time residents, says Sebree.
“There will be a major focus this session to stem the tide of policies entering Citizens Property Insurance Corp., which is currently around 8,000 per week,” he explains. “We will also look at mitigation and incentives to help make Florida properties stronger and better able to withstand storms.”
To find out more about Florida Realtors’ legislative priorities this year, go to http://www.floridarealtors.org/LegislativeCenter/TopInitiatives/2013-Legislative-priorities.cfm.