Sunshine Sentinel

Taxes on commercial rents and leases in Florida will be reduced by 1% starting December 1, 2023. This change comes as a result of legislation supported by the National Federation of Independent Business (NFIB), which reduces the sales tax on commercial leases from 5.5% to 4.5%.

Businesses across Florida have begun receiving notifications from landlords regarding these adjustments. The savings vary based on the type of lease: Class A commercial leases will save $360 annually per 1,000 square feet, Class B will save $268, and Class C will save $190.

The NFIB has been advocating for this tax cut, arguing that it is unique in the nation and burdensome for business owners. Bill Herrle, Executive Director of NFIB in Florida, stated that "levying a sales tax on commercial leases hinders a common asset-building strategy for our local job creators, making it more difficult for them to expand their operations, create new jobs, and raise wages."

Herrle also mentioned future reductions: "There’s more good news to come," he said. "The law commits the state to further reductions in 2024. We’ll see the rate drop from 4.5% to 2% sometime in the second quarter of 2024."

NFIB's ultimate goal is to eliminate the sales tax on commercial leases entirely. They are urging legislators to commit to removing the remaining 2% tax rate during the upcoming legislative session in 2024. Each percentage point reduction returns approximately $400 million to small business owners in Florida.

The NFIB encourages continued engagement with their efforts to abolish what they refer to as a rent tax.