Florida Governor Signs Tax 'Holidays,' Gas-Tax Break
"The tax relief you're going to see are going to be breaks for really critical needs, like gas, diapers, disaster supplies, tools for skilled trades, recreational activities, you name it," Gov. Ron DeSantis said.
May 09, 2022 at 12:59 PM
5 minute read
A series of sales-tax "holidays" on such things as school clothes, hurricane supplies and tools and a suspension of the state gas tax in October topped a package signed into law by Gov. Ron DeSantis.
The tax package (HB 7071), passed by the Legislature in March, will reduce state and local revenues by $804.3 million during the upcoming fiscal year, according to a House staff analysis. The total will increase to about $1.1 billion when future impacts are factored in.
Along with holding traditional tax-holiday periods before the school year and as hurricane season starts, the package will eliminate taxes during all or part of the 2022-2023 fiscal year on items including baby clothes, diapers, children's books, Energy Star appliances, impact-resistant doors and windows, new mobile homes and admissions to Formula One Grand Prix races and the Daytona 500.
"This bill comes at an opportune time, as families grapple with the rising costs of everyday expenses like gas, food and clothing," Department of Children and Families Secretary Shevaun Harris said during an appearance with DeSantis in Ocala. "I know that every penny saved counts."
State leaders touted that the election-year package will help consumers.
"The tax relief you're going to see are going to be breaks for really critical needs, like gas, diapers, disaster supplies, tools for skilled trades, recreational activities, you name it," DeSantis said. "And, so, families are going to be able to save for things that really matter for them."
DeSantis, whose youngest child is 2 years old, highlighted the tax breaks for diapers and baby clothes during a bill-signing ceremony at Sam's Club in Ocala. The ceremony included a stack of Huggies diapers and several families.
"You've got to do the diapers, there is no way around that," DeSantis said.
First lady Casey DeSantis chimed in, saying, "We have one child in diapers now. But two and a half years ago, we had two and a half kids in diapers."
While most of the tax package will not take effect until July 1 or later, two parts of it will start this month.
A sales-tax exemption on children's books will run from May 14 to Aug. 14. Also a tax holiday will start May 28 on hurricane supplies.
That holiday, which will run through June 10, is projected to save shoppers $25.6 million. They will be able to avoid paying sales taxes on an array of items, from packages of batteries and radios under $50 to generators up to $1,000. The hurricane-season holiday for the first time will include pet supplies.
The second tax holiday, projected to lead to $70.6 million in savings, will be for what lawmakers have dubbed "Freedom Week," which will run from July 1 through July 7. Shoppers will be able to avoid paying sales taxes on such things as tickets for concerts, movies, ballgames and museum visits, as well as on certain gear for outdoor activities. For example, they will not pay sales taxes on the first $500 of the price of canoes or kayaks.
A back-to-school tax holiday will start July 25 and last through Aug. 7. Shoppers will be able to avoid paying sales taxes on clothes and shoes that cost $100 or less, school supplies that cost $50 or less and personal computers with price tags of $1,500 or less. Economists estimate the holiday's impact to total $100.1 million.
A new tax holiday, with $12.4 million in projected savings, will run from Sept. 3 through Sept. 9 and has been dubbed the "tool time" holiday. During the period, people will be able to avoid paying sales taxes on certain tools and other work equipment.
In the month before voters go to the polls for the November elections, they also will get a break at the gas pump. The package includes suspending the roughly 25-cents-a-gallon state gas tax in October. Lawmakers decided to use $200 million in federal stimulus money to make up for lost gas-tax revenue, which goes toward transportation projects.
"There's certain things when you have inflation that you can maybe dial back, certain entertainment, whatever, people can make decisions with their family budget," DeSantis said. "You really can't just not get around to your job. So, you've got to fill up your gas tank."
Agriculture Commissioner Nikki Fried, a Democratic candidate for governor, issued a statement Friday that said many of the tax breaks were aided by federal stimulus money.
"This tax relief package was made possible by the American Rescue Plan, which provided Florida with more than $10 billion in federal funds," Fried said. "Working Floridians would not be able to access these benefits without the hard work of President Biden and Democrats who wrote and passed this historic legislation into law. This tax package contains important provisions like a tax exemption for energy efficient appliances that my office worked to include and an exemption for diapers that Florida Democrats fought for. "
A big-ticket part of the package would eliminate sales taxes for two years on impact-resistant doors and windows, which is projected to lead to $205 million in savings during the 2022-2023 fiscal year.
Parents are projected to see savings of $74.7 million by not having to pay sales taxes on clothes and shoes for toddlers and another $35.7 million on the costs of diapers.
Meanwhile, making tax exemptions permanent for Formula One races carries a recurring savings of $5.8 million, while eliminating sales taxes on tickets to the Daytona 500 will hit state and local revenue by $6 million a year.
Also, an exemption for "green hydrogen" machinery and equipment backed by Florida Power & Light would cut tax revenue by $300,000 a year.
Jim Turner reports for the News Service of Florida.
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