News & Media
TALLAHASSEE, Fla. – The state sales tax on commercial leases dropped Saturday to 2.0% from 4.5%, providing Florida employers with an estimated $1 billion in tax relief.
The tax, also known as the Business Rent Tax, was originally slated to begin on July 1 with a 2.5% reduction. The timing of the reduction was tied to replenishing the state’s Unemployment Compensation Trust Fund, which was depleted during the COVID-19 pandemic. The trust fund was replenished to its pre-pandemic benchmark of $4 billion in March, earlier than expected.
The Florida Department of Revenue’s tax information publication shared details of the reduction:
“Effective June 1, 2024, the state sales tax rate imposed under section 212.031, Florida Statutes (F.S.), on the total rent charged for renting, leasing, letting, or granting a license to use real property (also known as “commercial rentals”) is reduced from 4.5% to 2.0%. Some examples of real property rentals subject to tax under s. 212.031, F.S., include rentals of commercial office or retail space, warehouses, and self-storage units or mini-warehouses.”
Florida Realtors® has long advocated for a reduction of the state sales tax rate charged for the rental, lease or license to use real property. Prior to the advocacy effort, the state sales tax rate was 6% on all commercial leases. This reduction is the single biggest cut since Florida Realtors began advocating for the elimination of the Business Rent Tax years ago.
FloridaCommerce said more than 2.9 million new businesses have been created in the state since 2019, with 2.5 million of them created since January 2020.
© 2024 Florida Realtors®
