Florida Governor Rick Scott signed into law a tax break for manufacturers. Specifically, the law eliminates the sales tax manufacturers pay on equipment purchases in Florida The law will not take effect until April 2014 and will expire three years after its effective date unless it is renewed by lawmakers.
There is some opposition to the law based on the estimation of a reduction in sales tax collections of $141 million a year. In addition, the law could be subject to a constitutional challenge because it will reduce revenue to cities and counties by as much as $30 million a year; however, the support for the legislation is overwhelming positive.
State Representative MaryLynn Magar sponsored the tax break legislation HB 7007. She believes the law will result in a net gain in revenue by encouraging manufacturers to hire more workers and boost investment in Florida. Currently about four percent of Florida’s jobs are in manufacturing.
Florida has not capitalized on its manufacturing potential, ranking 43rd nationally in manufacturing employment. David Hart of the Florida Chamber of Commerce said, “This change is a way to make us more competitive and attract some of those jobs, which by the way, that sector – manufacturing jobs, pays about 122 percent of the state average for salaries, so great jobs to bring to our state.”
The tax break comes at a time when Florida’s manufacturing industry is experiencing growth. The latest figures show Florida’s manufacturing business grew at a rate of 3.3 percent from 2010 – 2011. The rest of the state’s economy grew at a rate of 0.5 percent over the same period.
Roy Schleicher, CEO of Jaxport, believes the law will help boost Florida’s exports. He said, “Jaxport’s exceptional connections to global trade lanes means manufacturers can already get their goods quickly to market. In order to attract more manufacturing, adopting this legislation will eliminate unnecessary obstacles to their success so we fully achieve our mission of providing jobs and opportunity for Florida’s citizens.”
Bill Johnson, Director of Port Miami has said, “Manufacturing is significant to economic growth in the state of Florida. With our proximity to the Caribbean and Latin America, Florida’s ports can serve as a logistics hub to move manufacturing goods quickly to some of the largest markets in the world. I am grateful for the leadership of the legislature and Governor Scott for championing this legislation which will help increase manufacturing and create jobs in Florida.”
Pat Stallings of the South Florida Manufactures Association has said of the new law, “What we see here is a tangible sign that Florida is committed to manufacturing, growing jobs, investing in business and drawing more business to Florida.”
In a tenure that has seen Governor Rick Scott’s rating at the bottom of all Governors, this appears to be one of his bright spots.
To receive email alerts when new articles authored by Armand Colson are available, click on the “Subscribe Button”. Contact at email@example.com