Rick Scott's Major Failure: Legislature Won't Eliminate Corporate Income Tax
Even at a time when billion-dollar deficits have become the norm for Florida's budget, Scott is championing the idea of completely phasing out the corporate income tax. It brings in about $2 billion a year in revenue, and Republican leaders in the legislature are obviously a bit hesitant to say bye-bye to all of that money.
Scott's plan originally aimed to eliminate the tax altogether over seven years through incremental decreases. The plan has been reworked and now would cut the tax from 5.5 percent to 4.5 percent in the first year. Further cuts would come if other state revenue increased to offset them. In other words, your tax dollars could go to offsetting huge tax breaks for corporations.
The corporate income tax brings in about $2 billion a year. It's considered relatively low compared to most other states.
The cut would cost the state about $333 million in the first year alone. Meaning legislators would need to find $333 million more in cuts, in addition to the billions in cuts they've already made to the budget.
Scott has teamed with Sen. Garrett Richter, of his hometown of Naples, to introduce the bill in the Senate. Richter asked to put the bill on hold in the Senate Commerce and Tourism Committee after it looked like it might not pass. That committee will not meet again for the rest of the legislative session. Richter could still try to attach the bill as an amendment to other legislation, but that seems unlikely. There are only two weeks left in the session.
"We could have had the votes to pass it, but frankly I don't think we want to pass it unless we're clear about what it is we're passing," Sen. Nancy Detert (R-Venice), the committee's chair, told the Associated Press. "I don't think you rush a bill that's hundreds of millions of dollars."
Detert also questioned the wisdom of drastic tax cuts during such a dark economic time.
The bill's companion in the House hasn't even made it to committee.
Scott and other defenders of the bill claim the tax cuts would mean job increases, but even notable conservative Republicans are questioning that logic.
Sen. Paula Dockery, by no means a moderate, pointed out the state lured Scripps Research Institute to Jupiter with $300 million in tax incentives but has seen only 330 jobs created by the institute. That's a little less than $1 million in money put up by the state for each job created. Think tanks, especially those that lean left, say the tax cut would do little in job creation.
Meanwhile, other Republicans such as Don Gaetz think if Florida is going to lower any taxes, it should be for the middle and lower classes. According to the St. Petersburg Times, Gaetz would like to see fees for drivers' and fishing permits lowered.
Though Scott has seen many of his promises pass, it appears this one is just a bit too much for the cash-strapped state to handle.
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