Property Tax Relief Property Tax Relief Senate Finance & Tax Committee January 25, 2007 Vicki Weber, Hopping Green & Sams P.A. Tax Consultant, Florida Chamber of Commerce

139,000+ Member Businesses 3 million+ Employees 80%+ Small Businesses Developed a coalition with other business associations on property tax issues

Member concerns Tax Competitiveness Recommendations

Member Concerns Member Concerns 97% experienced tax increases 81% more than 10% increase 67% more than 20% increase 85% tax growing faster than revenues

Member Reactions to Tax Increases Member Reactions to Tax Increases Reduce employee benefits (health care) Cut inventory or cut or freeze hiring Raise prices/lower profits Shelve expansion plans Decrease advertising Sell rental property Leave Florida

Member Requests Member Requests Halt rate of tax/spending increases Fix inequities across taxpayers Address unpredictability of taxes Make assessments more consistent with income that can be earned on property Address SOH lock-in—but not by just redistributing the burden Address shifting of tax burdens onto non-homestead properties

COST Report on Business Taxes COST Report on Business Taxes Council on State Taxation Non-profit trade association 550 multi-state corporate members Founded by Council State Chambers Florida Chamber of Commerce Member E&Y “Total State and Local Business Taxes”

COST Report COST Report What are total taxes business pays the state? How are current state and local business taxes affecting the state’s economic competitiveness?

Business Taxes as % of Private Sector GSP FY 2005 Florida5.4% Georgia 4.0% Alabama4.2% South Carolina4.4% North Carolina3.7% U.S. Average4.8%

E & Y Report “Property Taxes on Business Capital” E & Y Report “Property Taxes on Business Capital” Competitiveness Index—Measures property tax relative to estimated net stock of business structures and equipment.

Competitiveness Florida1.02 Georgia.90 Alabama.61 South Carolina1.27 North Carolina.72 U.S. Average1.00

Recommendations Recommendations Comprehensive property tax reform that addresses: affordability equity accountability transparency

Affordability Affordability Impose a reasonable statutory cap on property tax increases—starting now.

Affordability Affordability Address “highest and best use” valuation standard so property owners are not subject to taxes that are grossly disproportionate to income that can be earned on the property.

Affordability Affordability Provide relief to business/rental property owners by providing exemption for tax on tangible personal property.

Equity Equity Reform VAB process per A.G. report Interest on Refunds/Market Interest on challenged payments Alternative dispute resolution processes Revised presumption of correctness threshold Uniform application of law across counties

Accountability/Transparency Accountability/Transparency TRIM notice reform Advertise tax increases

Complex. Calls for comprehensive reform. Partner with you as develop solutions. Thank you.