Property tax cut effort debated

Property tax cut effort debated

	Published : Wed, 17 Oct 2007 17:51 By : Agencies Print this Story

TALLAHASSEE, Fla. (AP) - A legislative effort to deliver property tax relief to Florida homeowners got bogged down Wednesday over differences between the House and Senate over how far the tax cutting should go.

The House is pushing to cap tax increases for non-homestead property owners, such as vacation and rental properties; the Senate opposes that. The chambers also differ over how much of a tax break should go to low-income seniors, with the Senate worrying about the impact on schools.

With the Senate and House plans diverging, and millions of dollars at stake for both taxpayers and local governments, many lawmakers said they wanted to slow down and study the impact of new proposals that were added to the mix.

'This is a heavily numerically driven process,' said House Speaker Marco Rubio. 'No one should vote in a state of confusion.'

Lawmakers have until Oct. 28 to finish their work. That would allow them time to get a proposal on the Jan. 29 ballot asking voters to change the way property taxes are calculated in several ways.

'We are going to take our time and get this done right,' said Rep. Dean Cannon, R-Winter Park.

The House and Senate have generally agreed on asking voters to increase the basic homestead exemption, which makes the first $25,000 of a house's value tax-exempt. Lawmakers want to double that.

Both chambers also want to limit how much property taxes would increase when people move to a new house. Now, the constitutional Save Our Homes rule prevents the taxable value of a home from going up more than 3 percent a year. But when someone buys a new house, they have to pay taxes on the true value, which means their tax rate often shoots way up.

Both also would allow people to take part of their Save Our Homes benefit with them to a new house. Each chamber is pushing for a tax break for new home buyers, and a large business tax break that would free potentially 1 million small businesses from having to pay property taxes on their 'intangible personal property,' which is their equipment.

The plans diverge in two significant ways:

The House this week added a provision to prevent property taxes on non-homestead properties -- mainly businesses, second homes owned by snowbirds, and rental properties -- from increasing in value by more than 3 percent a year, as is the case with homesteads.

The Senate, meanwhile, has a limited proposal to give a tax break to certain low-income senior citizens, making the first $100,000 of their homestead property tax free. The House would eliminate all property taxes for low-income seniors.

Gov. Charlie Crist campaigned on trying to reduce property taxes, and there's broad, bipartisan support in both chambers for some sort of tax relief. But how far to go -- and how to do it without dramatically hurting schools and other basic services provided by local governments has proved thorny.

For the most part, school taxes wouldn't be affected by many of the major tax cut proposals. But some of the proposals would cut school taxes -- potentially costing schools more than $1 billion a year. That has many Democrats skeptical of parts of the plan. Even though Democrats are in a minority in the Legislature, their help is needed to get the issue on the ballot in January because it requires a super-majority vote by lawmakers.

Another deep concern is coming from lawmakers who represent small, rural counties that already have a small tax base and are concerned about losing tax revenue.