House approves
sweeping tax plan
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Article Courtesy of The Orlando Sentinel
By Jason
Garcia and John Kennedy
Published April 19, 2007
TALLAHASSEE
-- House Speaker Marco Rubio muscled his controversial plan to abolish
property taxes on primary homes through the Florida House on Wednesday,
setting up a late-session showdown with a Senate that so far has shown
little interest in a package that also involves raising the sales tax.
The Senate is expected to begin debating a much different property-tax
plan today.
With just two weeks remaining in the session, the two chambers remain so
far apart that some in the Capitol are predicting lawmakers might have to
return to cut a deal in overtime.
"I think we're too far apart right now," said Senate Minority
Leader Steve Geller, D-Cooper City. "Some of these bills, we can't
resolve at the last minute."
Rubio and House Republicans shrugged off such concerns in plowing ahead
with the two-pronged package they have been aggressively promoting for
weeks.
"I think now it all is coming to a head," said Rubio, R-West
Miami.
The centerpiece of the House plan is a constitutional amendment that
would, if voters approved in both statewide and individual county
referendums, erase all property taxes on primary homes. But it also would
add up to 2.5 cents to the sales tax.
Rubio and other House leaders said the measure would generate a net tax
cut of about $7 billion -- by slashing $15.8 billion in property taxes
while raising $8.9 billion in sales taxes -- and revolutionize
homeownership in Florida.
"Know that you're fixing to make history by voting for the largest
tax cut in history," House Budget Chairman Ray Sansom, R-Destin, told
members moments before the final vote.
But Democrats complained that the plan would give homestead property
owners a free ride on taxes at the expense of everyone else, particularly
lower-income renters who they said would be hit especially hard by the
sales-tax increase.
"We support progressive tax cuts. We don't support regressive tax
increases," said House Minority Leader Dan Gelber, D-Miami Beach.
The proposed constitutional amendment was approved 78-40 -- six votes more
than required to get the measure on the 2008 ballot, but far short of the
90 needed to call a special election this year.
Two Republicans voted against the plan -- Reps. Andy Gardiner of Orlando
and Gayle Harrell of Stuart -- while a trio of Democrats voted for it.
"It's a tough vote. I'm very supportive of the property-tax
reduction. . . . I just really struggled with us doing an additional tax
on sales tax," said Gardiner, who is running for a Senate seat held
by term-limited Sen. Daniel Webster, R-Winter Garden.
The other half of the House plan -- a bill that would immediately force
cities and counties to roll back their property-tax collections to
adjusted 2000-01 levels, cutting $6.3 billion overall -- breezed through
the chamber on a unanimous vote.
That rollback is far deeper than one the Senate will take up today when it
considers its own plan.
The Senate has suggested local governments be forced to roll back only to
2005-06 levels -- a difference of billions of dollars.
Senators so far have flatly rejected any sales-tax swap, instead offering
a plan to double the state's $25,000 homestead exemption for first-time
buyers and allow homeowners to carry some of their Save Our Homes tax
savings with them when they move to a new home.
The House is expected to begin moving its own measure to make Save Our
Homes portable, which some have taken as a signal that it does not expect
the Senate to budge on the sales-tax swap.
That would leave the debate about how large a cut to force local
governments to absorb as the central dispute in the session's closing
weeks.
Sen. Mike Haridopolos, R-Melbourne, chairman of the Senate Finance and Tax
Committee, said he was not giving up on finishing the session May 4, as
scheduled, with a tax-cutting package complete.
"We all want to get out of here and be with our families,"
Haridopolos said. "But more importantly, we want to go back to our
neighbors and say we cut taxes across the board in a fair manner."
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