Taxes on Commercial Rents and Leases To Be Cut by 1% On December 1, 2023.
Taxes on commercial rents and leases in Florida will be cut by 1% on December 1, 2023 when a law supported by NFIB comes into effect. Many businesses have received notices from landlords of the adjustments which come as a result of cutting the sales tax on commercial leases from 5.5% to 4.5%.
An average Florida Class A commercial lease will save $360 per year per 1000 sq feet. An average Florida Class B commercial lease will save $268 per year per 1000 sq feet, and an average Florida Class C commercial lease will save $190 per year per 1000 sq feet.
NFIB pushed the legislature to cut this business tax, which is the only one of its kind in the nation. Even a business owner who owns their business property under another legal entity must pay the tax when they pay rent from one wholly owned entity to another. Bill Herrle, Executive Director of the NFIB in Florida said “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. That’s why NFIB has been key-voting this issue in Tallahassee for years.”
“There’s more good news to come,” said Herrle, “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 will not stop until the sales tax on commercial leases is totally eliminated. NFIB is pushing the legislature to commit to a elimination of the remaining 2% tax rate in the 2024 legislative session. Every 1% of the sales tax on commercial leases cut returns approximately $400 million to Florida small business owners.
Stay engaged with NFIB to lend your voice to our ongoing efforts to end the rent tax.
