President Obama’s fiscal year 2015 budget proposes to increase taxes on individuals by over $820 billion and on businesses by about $500 billion, for a total of over $1.3 trillion in new taxes over the next ten years....
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- Florida Senate Unanimously Votes to Put Personal Property Tax Cut o...
Florida Senate Unanimously Votes to Put Personal Property Tax Cut on Ballot
Last Friday, the Florida Senate unanimously approved HJR 1003, a proposal to raise the state's personal property tax exemption from $25,000 to $50,000. The measure, which is a constitutional amendment, will now be given to Florida taxpayers, who will need to approve the measure by a 60 percent margin in order for the tax cut to take effect.
As I argued in my testimony to the Finance and Tax Committee of the Florida House of Representatives, the tangible personal property tax is an especially destructive way of collecting tax revenue, as it distorts business decisions relating to the accumulation of capital.
Each year, all business property (machinery, office contents, etc.) is subject to an ad valorem tax based on its depreciated value. Not only are there complexity concerns with properly accounting and depreciating these business inputs (look at the form here), the tax also places a disincentive on the accumulation of new capital—it punishes businesses that employ new and innovative technologies in their production methods.
Raising the exemption from $25,000 to $50,000 would mean that nearly half of current TPP tax filers will no longer be required to file this cumbersome and distortionary tax.
More on Florida's tangible personal property tax here.
More on Florida here.
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