With revenue down across Florida due to the coronavirus pandemic, Florida TaxWatch (FTW) urged the Legislature to take steps to rectify that, including taking “action to properly collect lawfully owed sales and use taxes on internet sales” and restoring the gaming compact with the Seminole Tribe.
The Office of Economic and Demographic Research (EDR) released a report on Tuesday showing revenue in Florida dropped $878 million below estimates last month and is now down more than $675 million compared to this time in 2019.
FTW President and CEO Dominic Calabro offered some ideas to help bring in more revenue.
“Today’s report from the Office of Economic and Demographic Research is staggering and makes the economic toll of COVID-19 abundantly clear,” Calabro said. “With revenue collections for the month of April coming in at more than $878 million below estimates, our leaders must take action to remain accountable to the taxpayers of our state and set Florida on the right path forward. Florida TaxWatch has long supported E-Fairness legislation, and a gaming compact with the Seminole Tribe as important and significant sources of revenue and now, with the COVID-19 pandemic costing hundreds of millions in lost revenues, these changes are no longer just desirable, they are essential.
“We cannot afford continued inaction on these critical issues. Today, we again urge the Florida Legislature to take decisive action and activate these needed revenue sources which will increase collections dramatically and help ensure a strong recovery for the Sunshine State,” Calabro added.
FTW insisted that Florida can expect another revenue hit in May.
“According to EDR, net General Revenue (GR) collections for the month of April came in $878.1 million (29.4 percent) below estimates. This is the first month of data that shows a significant decrease in revenues due to the impact of COVID-19 on the state’s economy. April GR collections generally reflect March sales tax activity, so a further decline in May collections (reflecting April sales) can be expected,” FTW noted.
“Coming into April, GR collections were running $202.4 million above the estimate made in January 2020. The decline in April collections, in addition to the previous revenue collection surplus of $202.4 million, means that GR is now $676.7 million under estimate year-to-date. It is worth noting that a significant portion of the decline is due to emergency orders delaying payment of some taxes or fees until June or later. These revenue sources (corporate income tax, corporate filing fees, and highway safety fees) were $323.1 million below estimates, accounting for 36.8 percent of the decline, and may be recouped in June, the last month of the current fiscal year. Florida’s significant reserves, as well as federal funding from the CARES Act, continue to be available for expenditures in the short-term, however with future and potentially larger revenue shortfalls expected, Florida TaxWatch will continue to monitor the state’s budget position,” FTW added.
Reach Kevin Derby at [email protected].
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