It’s been just shy of a month since Donald Trump took office and started his second term as president, and he’s wasted no time shaking up nearly every aspect of how the country operates.
Florida Gov. Ron DeSantis has recently joined the fray and taken aim at property taxes, calling them a “more oppressive and ineffective form of taxation.”
“Property taxes are local, not state. So we’d need to do a constitutional amendment (requires 60% of voters to approve) to eliminate them (which I would support) or even to reform/lower them… We should put the boldest amendment on the ballot that has a chance of getting that 60%…,“ DeSantis wrote in a Post on X on Friday.
While sales tax makes up the majority of Florida’s budget, property taxes play a critical role in employing and funding firefighters and police. Property tax is also used to help provide funding for public schools.
In theory, the more money collected from property taxes, the better-equipped firefighters and police will be to answer calls trained, prepared and in a timely manner. Better-funded schools provide students with a higher chance of succeeding should they decide to continue their education or enter the workforce.
Property tax isn’t collected by the state directly, however. Local governments receive much of their funding through them instead. DeSantis’ post did not provide any insight into how counties might make up the difference the loss of property tax would have on their budgets while providing communities with critical services.
Here’s what to know about property taxes and what would happen if we did away with them.
What is property tax?
Property tax is a tax that someone pays for owning property. It can be levied by any sort of governing body, but it’s levied by local governments in the United States. The funds collected through property tax are then distributed to pay for all sorts of things.
What do Florida property taxes pay for?
Florida property taxes go toward critical infrastructure and services that are used by or impact taxpayers on a daily basis. These include things like:
- Law enforcement
- Social services
- Parks
- Environmental programs
- Fire districts
- Emergency medical services
- Schools
- Roads
Because property taxes are collected by local governments, the exact services they fund and the amount vary.
How are property taxes determined?
Property taxes will depend on where you live and the property itself. You can look at the assessed property value and local tax rates to determine how much you’ll pay in property taxes.
Local governments typically charge property taxes using millage rates. A county will set the millage rate by determining how many dollars it will charge for each $1,000 of value. So, if you’re millage rate is 1 mill, that means the county charges $1 per $1,000 of value.
The assessed value is the next step of the equation. At the beginning of each year, Florida’s property appraisers will determine the market value of your home and apply any exemptions, assessment limitations and any other things that could impact your property value.
Your property taxes are then determined by essentially multiplying your property’s taxable value by your county’s millage rate.
How much does Florida collect in property taxes?
Floridians pay some of the highest property taxes in the country. Housingwire.com reported that the median 2024 property tax in Florida was $3,101, which was a 9.5% increase over the prior year and a 47.5% increase from 2019.
South Florida has seen the biggest increase in property taxes, with payments in counties like Miami-Dade and Broward, which both saw 56.8% increases since 2019.
Is Florida a tax-friendly state?
Florida has a great reputation for being a tax-friendly state because residents pay no income tax. It’s certainly great when tax season comes around, but it’s not quite the case every other day of the year, especially for low-income taxpayers.
Much of Florida’s tax revenue is generated from sales tax, and it’s one of the most regressive in the nation, according to the Florida Policy Institute, an independent, non-partisan and nonprofit organization.
Because nearly 80% of Florida’s tax income comes from sales taxes and excise taxes, like taxes on motor fuel, alcohol and tobacco, the state’s tax system is often referred to as “upside-down.” It’s the state’s lowest-income taxpayers that pay the most in taxes.
Institute on Taxation and Economic Policy’s latest Who Pays? report found that the bottom 20% of Florida taxpayers had a state and local tax rate nearly five times that of the top 1%.
The average effective state and local tax rate is 13.2% for Florida families and individuals with the lowest income, 9.1% for those in the middle, and 2.7% for the top 1%.
Florida is one of 41 states that tax the top 1% less than every other income group and one of 34 states that tax residents with the lowest income at a higher rate than any other group.
So, how is it that low-income taxpayers end up footing most of the bills if everyone is charged the same percentage in taxes?
Income proportion is a big issue. When low-income taxpayers pay the same tax rate as high-income earners, they are paying a greater portion of their income comparatively.
Consumption patterns are another factor that coincides with income proportion. Low-income families tend to spend more of their wages on taxable necessities, while higher-income families can put extra income toward non-taxable items things like retirement or investments.
In other words, the more money you earn, the more tax-friendly Florida is.
How would Florida fund police and schools without property tax?
DeSantis’ post didn’t provide any insight into alternative methods to keep these crucial services around for communities.
The reality is that without funding to support police and fire departments, these services would simply disappear, though they would more likely be replaced by private initiatives. Either way, people would have to pay for the services either through taxes or voluntarily.
Alternatively, local governments could seek other avenues to acquire the resources needed to keep these services around. It could mean higher sales taxes, an introduction of user fees, hotel taxes or any number of alternative ideas.
As with any change to the state constitution, it would ultimately be up to Florida voters to decide if they would prefer to keep property taxes around or venture down another path should a ballot initiative make it to a future election.