Of all of the ideas on stimulating job growth and small business in Florida, this ranks as one of the best -- should Florida voters approve a November referendum. Amendment 10 to the state constitution, also known as the Tangible Personal Property Tax amendment, proposes to reduce the tax burden on the smallest businesses.
Companies pay the TPP tax on machinery, furniture, computers, signs, supplies and other equipment, though currently there is a $25,000 exemption. The amendment would eliminate the tax on businesses with less than $50,000 in taxable property value.
The amendment also provides local governments -- counties and cities -- with the flexibility to grant additional TTP tax relief to attract business investment.
Lakewood Ranch-based developer Pat Neal has been leading Gov. Rick Scott's campaign on this amendment since he first proposed the idea to the governor in May 2011.
Neal chaired Florida TaxWatch last year and directed the nonprofit and nonpartisan research institute's study into the issue. Those findings helped propel the proposal through this year's Legislature and onto the November ballot.
Florida TaxWatch determined that 156,000 businesses would qualify for the new exemption out of the 300,000 companies now paying the tax, saving $20.1 million in the process.
That amount would be taken out of the coffers of county and city governments, school districts and special districts, forcing those entities to either raise other taxes or further reduce spending.
But the long-term potential for this tax break outweighs the loss -- by stimulating job growth through business expansions and relocations, which that would then result in new revenues.
The revenue loss is not that great for Manatee County, only amounting to $190,000 in the exemption's first year, 2014. Significantly, the Florida Association of Counties, which calculated the tax loss for each county, supports passage of the amendment.
Statewide in 2011, the TPP tax raised $1.8 billion -- with the $20.1 million in savings only a small percentage of that total.
Florida TaxWatch projects the amendment's passage would spur the creation of 3,000 jobs annually in certain fields. In this shaky economy, the Sunshine State needs the competitive advantages that the tax exemption will bring.
Neal, a former state senator and the owner and chief executive of Neal Communities, is leading the campaign for passage through a task force that is mounting a publicity effort. We wish him success in this endeavor. Small business needs the boost.
We support passage of Amendment 10.