Senate votes for delay in tax cut

Now the 18-month postponement, supported by the governor, will be considered by the House.

By STEVE BOUSQUET
© St. Petersburg Times,
published December 4, 2001

TALLAHASSEE -- The Senate voted Monday to postpone for 18 months the next cut in a state tax on investments, a move that will leave an estimated $130-million in the treasury and avoid deeper budget cuts.

Sen. Ken Pruitt's legislation would delay the action from Jan. 1, 2002, to July 1, 2003. The Port St. Lucie Republican predicted the House would pass the bill before Thursday's scheduled close of the two-week special session.

Politically, the Senate vote was the easy part.

Now the House, whose refusal to consider a tax cut delay in late October caused the first special session to collapse in chaos, must take the same vote to bring this session to a peaceful conclusion by Thursday.

House Speaker Tom Feeney has been one of the tax's leading critics, arguing that the tax punishes Americans for saving money that has already been taxed once as income.

But Gov. Jeb Bush's support for a postponement in cutting a tax he has called "onerous" provides convenient cover for conservative House members who are worried about appearing to renege on a tax cut commitment.

Bush says he has 61 solid Republican votes to delay the tax cut, but even some allies say they won't believe it until they see it.

"I'm always leery when we go into these things," said Senate Majority leader Jim King, R-Jacksonville. "Sometimes it's predictable, but sometimes it's like if the flame gets too close to the gasoline can, when you thought it was a safe distance away, it can explode."

Investors pay a tax of $1 for every $1,000 of holdings in stocks, bonds and notes. Currently, the first $20,000 of holdings are exempt for individuals, or $40,000 for couples. The latest cut, which is now being delayed, would exempt the first $250,000 in holdings for individuals and $500,000 for couples.

The Senate floor vote was 37-2. Two Miami area Democrats, Kendrick Meek and Daryl Jones, voted no. Jones, a candidate for governor, later said he changed his vote to a yes vote in favor of deferral.

Sen. Richard Mitchell, D-Jasper, briefly argued in favor of a more dramatic amendment to restore the tax to its level before Bush took office in 1999.

© 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South • St. Petersburg, FL 33701 • 727-893-8111

Contact the Times | Privacy Policy
Standard of Accuracy | Terms, Conditions & Copyright