Retailers pitch back-to-school tax break

  • August 4, 2015
  • /   Jim Turner
  • /   economy

A longer than usual back-to-school tax holiday gets underway Friday, and a lobbying arm for retailers is already making plans to sell lawmakers on keeping the extended discount period next year.

The Florida Retail Federation also is eyeing a number of other proposed sales-tax breaks that failed to win legislative support this year --- breaks that would apply to the purchase of hurricane supplies, energy-saving appliances and for guns and fishing gear to use while camping.

"We're eager to explore more options for sales-tax holidays," Florida Retail Federation spokesman James Miller said.

Retailers see the tax holidays as moneymakers. The back-to-school holiday starts at 12:01 a.m. Friday and runs through 11:59 p.m. Aug. 16.

"We're excited this year's Legislature and Gov. Scott came around and saw the importance of having it 10 days," Miller said. "I think it's going to be important for families. Depending upon when a family may get a paycheck, this first of the month or 15th, or both, by having it from the 7th to the 16th it gives families multiple weekends."

Since the first sales-tax holiday was offered in 1998, the discount period has only stretched to 10 days once before, in 2007.

State economists project that this year's back-to-school holiday period, which had been offered at three days each year since 2011, will reduce state and local revenue by $67.8 million.

Retailers anticipate the discount period will bring in shoppers who may be tempted to pick up additional items while in the stores.

And while the tax-break period is based on the premise of helping families with students returning to classes, the sales are open to all shoppers with discounts ranging from simple school supplies to clothing under $100. Also, the break applies to the sales tax on the first $750 of the price of laptop computers and certain other electronics for personal use.

House Finance & Tax Chairman Matt Gaetz, who helped author a tax-cut package that included the holiday, said he's already getting feedback from people that the 10-day tax break period gives families more time to plan for the discounts.

Lawmakers put together the wide-ranging tax cut package (HB 33A) in June during a special session on the budget.

The package also includes cuts to the communications-services tax on cell-phone and cable-TV bills and eliminates for one year sales taxes on college textbooks. The package is projected by state economists to cut revenue by $372.4 million in the fiscal year that began July 1.

The House initially proposed a $673 million package that included a small-business tax holiday two days after Thanksgiving and a one-day sales-tax holiday on July 4 for outdoor equipment including guns, spear-guns and bows, ammunition, camping tents and fishing gear.

But that package died as lawmakers ended the regular session without a budget.

Gov. Rick Scott touted the back-to-school tax break Monday while handing out school supplies in West Palm Beach during the Office Depot Foundation's "National Backpack Program."

Scott is expected to call for more than $500 million in tax cuts for the 2016 legislative session.

In 2014 Scott campaigned on a promise of $1 billion in tax cuts over a two-year period.

Gaetz, R-Fort Walton Beach, said the 2016 tax-cut package will depend on state revenue projections, which lawmakers will get before the session begins in January.

"We'll have to look at the revenue forecasts and our cost models to determine what our appetite is as a legislature for tax cuts," Gaetz said.

He expects the back-to-school tax holiday to be on the table, along with his own proposal to establish an Independence Day discount on camping equipment.

But when calculating the cuts, Gaetz said priority is expected to be given to prior Scott proposals to make a manufacturing tax cut permanent and to reduce a commercial real-estate rent tax.

"Those will probably be near the top of the list for me," Gaetz added.

Gaetz's counterpart, Senate Finance and Tax Chairwoman Dorothy Hukill, who has pushed in the past to reduce the commercial rent tax, on Monday reintroduced another of Scott' past tax-cut priorities.

Hukill, R-Port Orange, filed a bill (SB 76) that would increase the corporate income-tax exemption from $50,000 to $75,000. Increasing the exemption would reduce — or even potentially eliminate — tax bills for businesses. Hukill also proposed the change during the 2015 legislative session, but it did not pass.

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