State Implications of the One, Big, Beautiful Bill
As the US House hashes out its “One, Big, Beautiful Bill,” statehouse lawmakers are watching closely, given the impact of both its tax and spending provisions on state budgets.
12 min read
Florida | #4 Overall
Florida‘s tax system ranks 4th overall on the 2025 State Tax Competitiveness Index. Florida boasts no individual income tax, a competitive 5.5 percent corporate income tax, and a sales tax rate which—despite the lack of an individual income tax—is lower than those levied in many other southern states. Unlike many of its regional competitors, Florida does not tax capital stock, and its corporate income tax largely adheres to national norms, yielding a highly competitive overall tax code. However, the state falls short on its treatment of capital investment, only allowing corporate taxpayers to claim 15 percent of the first-year expensing of machinery and equipment offered under the federal tax code. With full expensing currently phasing down at the federal level, states are increasingly exploring making 100 percent first-year expensing permanent, whereas Florida only offers a fraction of a declining federal allowance.
Florida offers a de minimis exemption for tangible personal property, but at $25,000, it is relatively low and offers a possible avenue for improvement. The state is also unusual in imposing a commercial lease tax. Nevertheless, in most regards, the state is among the more competitive in the country.
| Category | Rank | Rank Change | Score |
|---|---|---|---|
| Overall | 4 | 0 | 6.78 |
| Corporate Taxes | 16 | 1 | 5.48 |
| Individual Income Taxes | 1 | 0 | 10.00 |
| Sales Taxes | 14 | 1 | 5.22 |
| Property Taxes | 21 | 4 | 5.22 |
| Unemployment Insurance Taxes | 10 | 1 | 5.63 |
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