By
FPI Staff
|
November 16, 2020

$4.5 Billion Tax Code Cleanup Would Preserve Crucial Public Services

FPI urges state lawmakers to adopt revenue-raising solutions that ensure shared prosperity in Florida

ORLANDO, Fla. - Florida Policy Institute (FPI) today released a list of 21 steps that state lawmakers should take to overhaul the tax code that would result in annual revenue of $4.5 billion, dollars which could then be used to preserve budget priorities amid Florida’s revenue shortfall. Policymakers risk exacerbating the state’s fiscal challenges, noted FPI, if they rely on measures like cutting taxes, reducing investments in public services, and reducing assistance to counties, cities, and families with low income.

“Investing in Florida families means investing in things like mental health care, roads and bridges, K-12 schools, and other vital services,” said Sadaf Knight, CEO of Florida Policy Institute. “It does not mean letting antiquated tax breaks and corporate tax loopholes remain in Florida statute in perpetuity. A cleanup of our state’s tax code is long overdue, and it’s the only just solution to balancing Florida’s budget while ensuring that families, businesses, and communities recover from the COVID-19 crisis.”

Nearly 40 percent of the $4.5 billion in revenue would come from five proposals:

  • returning to a corporate tax rate of 5.5 percent ($444 million);
  • closing corporate tax loopholes by reenacting “combined reporting” to fairly tax large multi-state corporations ($477 million) and the “throwback rule” to tax income that would otherwise go untaxed ($62 million); and
  • modernizing Florida’s sales taxes by enforcing collection from remote online purchases ($262 million) and marketplaces like Amazon ($514 million).

FPI has included the tax code cleanup plan in its 2021 policy agenda, which prioritizes expanding Medicaid to all adults with low income, removing occupational barriers for returning citizens, and enacting a state Earned Income Tax Credit for working families with low and moderate income.

“Enacting these measures would move our state in the right direction and help build a more sustainable future for Floridians,” added Knight.

FPI is an independent, nonpartisan and nonprofit organization dedicated to advancing state policies and budgets that improve the economic mobility and quality of life for all Floridians.

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