Florida’s New Tax Cuts for Residents and Businesses

Florida has enacted a tax relief package, outlined in House Bill 7073, designed to provide financial assistance to residents and businesses. This legislation introduces a series of targeted tax cuts and temporary exemptions intended to lower costs for families and stimulate economic activity. The measures encompass a variety of tax types, aiming to deliver savings across different sectors. This article covers the package’s sales tax holidays, property tax relief, and business tax reductions.

Sales Tax Exemptions and Holidays

The tax relief package includes a series of sales tax holidays that temporarily eliminate tax on specific goods. These holidays are timed throughout the year to align with events like hurricane season and the start of the school year. For the 2025-2026 fiscal year, these holidays are expected to save shoppers hundreds of millions of dollars.

Disaster Preparedness

To help residents prepare for hurricane season, the state has scheduled two 14-day disaster preparedness sales tax holidays. The first is from June 1 to June 14, 2025, and the second is from August 24 to September 6, 2025. During these periods, various emergency supplies are exempt from sales tax.

Eligible items include:

• Portable self-powered light sources selling for $40 or less.
• Portable self-powered radios, two-way radios, or weather-band radios selling for $50 or less.
• Tarps, flexible waterproof sheeting, ground anchor systems, or tie-down kits priced at $100 or less.
• Pet carriers for small animals selling for $100 or less.
• Bags of dry pet food weighing 50 pounds or less with a sales price of $100 or less.
• Portable generators selling for $3,000 or less.

Back-to-School

A 14-day back-to-school sales tax holiday is scheduled from July 29 to August 11, 2025. This holiday covers:

• Clothing, footwear, and certain accessories with a sales price of $100 or less per item.
• School supplies with a sales price of $50 or less per item.
• Learning aids and puzzles with a sales price of $30 or less.
• Personal computers and certain computer-related accessories with a sales price of $1,500 or less, for noncommercial use.

Freedom Month

Throughout July 2025, a “Freedom Month” sales tax holiday exempts various recreational items and activities to reduce the cost of summer entertainment. The exemption applies to tickets for live music events, sporting events, plays, and museum entries scheduled between July 1 and December 31, 2025.

The holiday also covers outdoor and recreational supplies, including:

• Sleeping bags and camping chairs with a sales price of $50 or less.
• Tents with a sales price of $200 or less.
• Fishing bait selling for $5 or less and tackle boxes for $30 or less.
• Fishing rods and reels priced at $75 or less individually, or $150 or less if sold as a set.
• Paddleboards and surfboards selling for $300 or less.

Skilled Worker Tool-Time

From September 1 to September 7, 2025, a “Tool Time” sales tax holiday provides an exemption for tools and equipment used by skilled trade workers, reducing the financial burden for those who purchase their own equipment. The exemption covers a range of hand tools, power tools, and protective gear.

Eligible items include:

• Hand tools selling for $50 or less.
• Power tools selling for $300 or less.
• Work boots with a sales price of $175 or less.
• Protective equipment like hard hats and safety glasses.

Property Tax Relief Measures

The tax package includes several property tax relief measures focused on homestead properties. One change extends the timeframe for homeowners to rebuild a property damaged by a calamity while retaining homestead tax benefits. The period to begin reconstruction has been lengthened from three to five years.

A provision addresses homeowners with a homestead exemption who have also received an assessment reduction for parent or grandparent living quarters. Under a rule effective for the 2025 property tax roll, if a property appraiser finds this reduction was improperly granted, they must give the property owner a 30-day notice to pay the back taxes, penalties, and interest before a lien can be filed. This change provides a window for homeowners to address assessment errors without immediate legal encumbrances.

The law also modifies how back taxes are calculated for clerical errors related to this assessment reduction. If a homeowner voluntarily discloses an error, no back taxes are due. If the appraiser discovers an undisclosed error, back taxes can be assessed for up to five years.

For certain residential properties with a homestead exemption, insurers must provide a premium deduction. This deduction equals the state’s 1.75% insurance premium tax and the State Fire Marshal regulatory assessment. The measure applies to policies issued between October 1, 2024, and September 30, 2025, lowering homeowner’s insurance costs.

Business-Specific Tax Reductions

Florida’s tax package includes targeted reductions for the business community, most notably affecting the tax on commercial leases. The state imposes a tax on the total rent paid for the use of any real property for commercial purposes, known as the business rent tax. A reduction in this tax has lowered the rate to 2%, providing relief for companies leasing office, retail, or industrial space and impacting their overhead costs.

The package also enhances tax credit programs. The annual cap for the Strong Families Tax Credit Program, which offers credits to businesses donating to child welfare charities, has increased from $20 million to $40 million.

A new corporate income tax credit is available for businesses that employ individuals with disabilities. The credit is $1 per hour worked, with a maximum of $1,000 per employee annually and a $10,000 total cap per corporation. The program is allocated a statewide maximum of $5 million annually for three fiscal years, beginning with the 2024-2025 fiscal year.