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Politics

House passes bill to kill taxes on primary homes

The Senate is debating a more cautious plan.

By ALEX LEARY
Published April 19, 2007

TALLAHASSEE -- The Florida House on Wednesday approved sweeping measures to slash property taxes, including a controversial plan to abolish all taxes on primary homes in favor of a 2.5-cent sales tax increase.

There was the possibility of dramatic Republican defectors, but the 78-40 vote fell mostly along partly lines.

"This vote is about leading on this issue and whether are you in favor of boldness or are you in favor of timidity," said Rep. Dean Cannon, R-Winter Park, who estimated the plan would save the average homeowner $2,300 annually.

Cannon will now play a lead role in difficult negotiations with the Senate, which has no appetite for a sales tax increase and whose plan is more tempered than that of the House.

The Senate begins debate today on its proposal, which has bipartisan support.

The House claims a five-year savings to taxpayers of $35-billion, while the Senate is calling for more than $12-billion.

The House also passed a plan to roll back local government tax bases to 2001, with adjustments for inflation and population, and a cap for future years. It would eliminate an estimated $6.3-billion from local government budgets.

Democrats unanimously supported the rollback, perhaps not wanting to be on the record as resisting any tax relief. Party leaders, however, said they expect the plan will be modified during negotiations.

Many say the rollback to 2001 is too harsh on cities and counties and could threaten essential services.

The plan serves as a placeholder of sorts for the larger tax swap proposal. It calls for replacing the property taxes for schools with a 1-cent sales tax increase.

Voters in each of Florida's 67 counties would then decide whether to eliminate the rest of property taxes on primary homes in exchange for an additional 1.5-cent sales tax.

That would bring the state sales tax to 8.5 percent -- the highest in the nation. In some communities the tax could be higher given local option levies.

Even if House Speaker Marco Rubio gains the required support from the Senate to put the plan on the ballot 2008, passage would be difficult. The constitutional amendment would require two-thirds approval of Florida voters.

Democrats have relentlessly attacked the $9-billion sales tax hike, saying it would hurt the poor who pay a disproportionate amount of their income on sales tax, as well as shift the property tax burden to businesses and second homeowners.

"You hear it's the largest cut. Well we think it's the largest tax increase," said Rep. Susan Bucher, D-West Palm Beach. "This is inequitable attempt to let one large class of taxpayers, who happen to be our voters, off the hook from paying property taxes."

But Republicans said the overall plan benefits all classes of property owners and that the American dream of home ownership was paramount.

Rep. Mike Scionti of Tampa was one of three Democrats who joined the majority.

"I was sent up here, as we all were, in a crisis mode, whether it was insurance or property taxes, and I took that responsibility very seriously," he said.

"We tried passing amendments that I thought could make a good bill better," Scionti added. "We weren't successful. But I certainly wasn't going to go home without being able to provide some tax relief.

[Last modified April 19, 2007, 06:04:19]