Brian Mudd

Brian Mudd

There are two sides to stories and one side to facts. That's Brian's mantra and what drives him to get beyond the headlines with daily stories driven...Full Bio

 

Governor DeSantis’ New Plan to End Sales Taxes on Many Items 

Photo: Getty Images

Governor DeSantis’ New Plan to End Sales Taxes on Many Items 

Bottom Line: On Tuesday Governor DeSantis introduced his sales tax proposals for the upcoming 2023-2024 year. In short, they’re the best Florida’s had yet. That’s in large part because, while many current sales tax holidays are being retained within the governor’s plan, many more areas of taxation would be eliminated next year – some permanently. The actual proposal calls for these sales tax holidays... 

  • 2-week Back to School tax holiday 
  • 2-week Disaster Preparedness Tax Holiday 
  • 1-week Tools and Home Improvement Tax Holiday 
  • 1-week Freedom Week Tax Holiday 
  • 1-week Energy Star Appliance Tax Holiday 

As I’ve articulated for years, it might be nice, but these holidays aren’t good economic policy. Analysis shows that 80% of Florida households don’t intentionally make use of Florida’s sales tax holidays. And as for those who do. They’re most often those who are the most likely to do so using debt – which commonly more than mitigates the benefit of the elimination of sales tax. As I’ve articulated... The better policy would be to add up the total value of the sales tax holidays and reduce the state sales tax rate on all purchases throughout the year by the nominal rate decrease. That way all people would benefit all the time from lower tax rates generally. Speaking of the legislature and politics. The biggest takeaway from DeSantis’ proposal is a huge move in this direction. Here’s the rest of his plan:  

  • A permanent tax exemption for baby and toddler necessities including diapers, baby wipes, clothing, and shoes for children under the age of 5. This would save Florida families an estimated $132.5 million.  
  • A permanent tax exemption for cribs and strollers. This will save Florida families an estimated $4 million.  
  • A permanent tax exemption on items that contain medicinal ingredients and medical equipment to close the gap on medical supplies and equipment that is not sales tax exempt. This would save Florida families an estimated $58.5 million.  
  • A 1-year tax exemption for household items under $25 like laundry detergent, toilet paper, paper towels, hand soap, and trash bags. This would save Florida families an estimated $112.3 million.  
  • A 1-year tax exemption for children’s books for children under 17 years old. This will save Florida families an estimated $16.8 million.  
  • A 1-year tax exemption for children’s toys designated for children between the ages of 2-12. This would save Florida families an estimated $116 million.  
  • A 1-year tax exemption for children’s athletic equipment like children’s bikes, footballs, soccer balls, rollerblades, baseballs, baseball bats, etc. This would save Florida families an estimated $33 million.  
  • A 1-year tax exemption on pet food for household pets and a permanent tax exemption for over-the-counter pet medications such as flea and tick prevention. This would save Florida families with pets an estimated $189 million. 

So, a series of permanently eliminated sales taxes and many others that are eliminated for a full year. That’s a much more effective economic approach and hopefully indicates a move in this direction generally and away from the short-lived annual sales tax holidays.  


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