The issue is whether doing away with property taxes simply amounts to a tax shift by increasing other fees and taxes such as the sales tax.
Gov. DeSantis FAU press conference
Gov. DeSantis FAU press conference reveals accreditation reworking
Gov. Ron DeSantis is pushing a plan to either do away with property taxes altogether or significantly reduce what counties and cities could levy on property owners. If the plan moves forward, voters will have to address the issue in 2026 when a constitutional referendum would appear on the ballot.
Property taxes across Florida currently generate about $60 billion annually. According to the Florida Policy Institute, property taxes make up about 50-60% of public-school funding, 18% of county budgets, and 17% of city budgets statewide. At issue is how to replace that $60 billion.
The House Select Committee on Property Taxes met in Tallahassee in September to discuss the possibility of property tax cuts and what they would mean to services that Florida residents have become accustomed to receiving. DeSantis argues that county local governments have increased their budgets far above the rate of inflation and that they could easily absorb spending cuts.
Take our poll. If propert taxes are eliminated, the sales tax is expected to nearly double. Tell us what you think.
The Florida League of Cities, though, claims that eliminating property taxes amounts to “giving control to distant lawmakers and bureaucrats” who do not know the community the way local elected officials do. Critics say the sales tax would have to be doubled to around 12% to make up for the loss of property tax revenue, and it is not clear whether that rate would even be high enough to replace all of the lost revenue. They also note that the sales tax is regressive, impacting low- and moderate-income residents much more than high-income ones.
In Palm Beach County, commissioners recently voted 5-2 against a plan to significantly cut the county budget. Concerns were raised that essential services would need to be reduced. The rate was kept at its current level but with new construction, the same rate will raise additional revenue.
Todd Bonlarron, Chief Deputy County Administrator for Palm Beach County, told the House committee that county is saddled with more than $49 million in state-mandated costs. He testified that the county carefully watches what it spends, ensuring that it is funding essential services needed by taxpayers.
Property taxes: The case for eliminating them
- Homeowners whose primary residence is in Florida would save thousands of dollars.
- The state would be the only one in the country without an income tax or property tax.
- There would likely be a massive migration and investment flow into the state.
- Tourists and non-residents would bear the brunt of funding government operations.
Property taxes: The case for keeping them
- There might not be enough money to pay for the operations of schools, city and county governments or to maintain existing infrastructure. Existing services would have to be cut.
- Owners of higher-value homes would benefit much more than would the owners of moderately priced homes.
- Local governmental entities would be dependent on state funding and would lose control of their budgets, furthe eroding home rule.
The Property Exemption website sums it up this way:
“Supporters envision a tax-free haven that attracts unprecedented growth and prosperity. Critics worry about sacrificing the public investments that made Florida attractive in the first place — quality schools, safe communities, and well-maintained infrastructure.”
Mike Diamond is a journalist at The Palm Beach Post, part of the USA TODAY Florida Network. He covers Palm Beach County government. You can reach him at mdiamond@pbpost.com. Help support local journalism. Subscribe today.