Wednesday, August 5, 2020
Florida lawmakers have shaved the state’s commercial lease tax rate for the third time in as many years, this year down to 5.5% from 5.7%.
The business rent tax — Florida is the only state to have such a levy — is applied to commercial real estate leases and can cost companies tens of thousands of dollars annually.
That’s because the tax is paid in addition to both rent and common area maintenance charges.
Landlords and commercial real estate groups have advocated eliminating the tax as a way to fuel economic development and business relocations from other states.
Gov. Ron DeSantis is expected to sign the reduction bill into law, with an effective date of Jan. 1.
“This tax makes Florida’s development and commercial real estate sector less competitive,” says Yvonne Baker, a regional managing partner with Tampa-based commercial real estate brokerage firm Franklin Street and the Florida president of the National Association of Industrial and Office Parks (NAIOP) this year.
“It zaps money that businesses could otherwise invest in growth and job creation,” Baker adds.
NAIOP, a national group that comprises more than 19,000 members in North America, advocates on behalf of commercial real estate landlords and property owners.
The Florida Legislature first cut the business lease tax during its 2017 session, when the levy was 6%, in response to moves by several other states to drastically reduce or eliminate lease taxes altogether.