Tax Policy and the Race for the Governor’s Mansion: Florida Edition

Voters in 36 states will be choosing governors this November. Over the next several months, the Tax Justice Blog will be highlighting 2014 gubernatorial races where taxes are proving to be a key issue. Today’s post is about the race for Governor in Florida.

It’s back to the future in the Sunshine State, where voters have the choice of keeping current Gov. Rick Scott (R) or reelecting former Gov. Charlie Crist (D). Crist, who left the Republican Party in 2010 and became a Democrat in 2012, is attempting to pull a Grover Cleveland and become only the second Florida governor to serve two non-consecutive terms.

Taxes have been front and center in this election, which has grown increasingly negative. Scott, who delivered on his promise to cut $500 million in taxes this year, is pledging another $1 billion tax cut if reelected. The 2014 cuts were mostly comprised of a repealed motorist fee increase approved by Crist and the state legislature in 2009, saving motorists an average of $25 per vehicle and costing the state $395 million in revenue. The other $105 million in cuts came from a so-called “patchwork of awesomeness,” and features three sales tax holidays, the elimination of taxes on college meal plans, therapeutic pet food, cement mixers, child car seats and a hodgepodge of other giveaways. Sales tax holidays are notoriously gimmicky, as reported many times on this very blog; it should also be noted that Florida already had two of the holidays in place, so those cuts were not exactly new.

Scott’s proposed $1 billion tax cut is far more ambitious. He wants a constitutional amendment to keep property taxes from rising if the value of a home stays steady or declines. The state constitution already prevents annual property tax increases over 3 percent, hampering the ability of local governments to fund schools and pay for infrastructure projects. Scott would also seek a permanent tax cut for manufacturing machinery, additional sales tax holidays, cuts on vehicle registration fees and cellphones, and would phase out the sales tax on commercial leases. His goal is to contrast his enthusiasm for tax cuts with Crist’s record of raising taxes (mostly on cigarettes and car registrations) during the economic downturn. Recent budget forecasts bring into question whether Scott’s plans are even financially feasible. 

Crist, meanwhile, charges Scott with advocating tax policies that help special interests and lobbyists at the expense of small-business owners and Florida families. He’s running on his record of tax cuts from his previous term, arguing that he cut property taxes for seniors and the middle class when he approved an increase in the homestead exemption in 2008. Republicans counter that Crist increased taxes by $2.2 billion the very next year to address budget shortfalls during the recession (like almost every other governor in the country). Crist has alleged that Gov. Scott raised property taxes, but his claims have been thoroughly debunked.