A study commissioned by Florida Realtors shows eliminating the tax would bring $4 billion into Florida in new business growth and operations in the first year and $19.7 billion over five years.

TALLAHASSEE, Fla. – A new study by the Regional Economic Consulting Group shows that if Florida were to eliminate its sales tax on commercial leases, known as the Business Rent Tax (BRT), the resulting economic benefits to the state would be substantial.

The study, commissioned by Florida Realtors®, reveals that if Florida were to invest $976.8 million to eliminate the tax, it would get back $4 billion the first year and $19.7 billion over five years in new business growth and operations. That investment would also lead to more than 58,000 new construction, operations and maintenance jobs over five years. Overall, for every dollar Florida invests in eliminating the BRT, it would get back more than $6 in new economic activity.

“We’ve known for some time now that eliminating the Business Rent Tax would be beneficial to our state, but until now, we lacked solid data to help prove that,” says Gia Arvin, 2024 Florida Realtors president and broker-owner of Matchmaker Realty in Gainesville. “This study shows that if our state were to invest in getting rid of this tax, the return on that investment would be a tremendous boom to our economy and result in significant community growth throughout Florida.”

Florida is the only state with a sales tax on businesses renting commercial space. Municipalities and local governments may also levy additional taxes on top of the state sales tax rate. Although reduced from its previous high of 6% down to 4.5%, the tax continues to create a financial burden for any business that leases space. Small businesses, which comprise 99% of all Florida employers, are disproportionately impacted by this tax because they are more likely to rent their location.

Reductions to the BRT over the past several years have allowed Florida businesses to expand, hire more employees, improve benefits and raise salaries. According to the study, eliminating the BRT would expand that business growth even more.

© 2024 Florida Realtors®

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Author: amyc