Democrats may try to make one of Gov. Rick Scotts 2013 priorities -- providing further tax breaks to manufacturers as outlined in his budget proposal -- a little tougher to get through the Legislature.
Members of the minority party on the Senate Appropriations Subcommittee on Finance and Tax expressed skepticism Tuesday that further cuts to the manufacturing sales tax, which Scott says should eventually be phased out, will lead to new jobs.
And they disputed that reductions in the tax in prior years have had a noticeable impact on the states unemployment rate, which has dropped from 11.9 percent in January 2011 to 8.percent in December 2012.
Im curious why the governor believes in giving tax breaks when they havent been shown to help the Florida economy, said Sen. Jeff Clemens, D-Lake Worth.
Its proven that these corporate tax breaks dont work and instead what were doing, at least the past couple of years, we made cuts in other areas when we could have used the revenue dollars. Im trying to figure out why this is still a part of the program.
Sen. Jeremy Ring, D-Margate, added that Florida already has a nationally recognized, positive business environment and proposals such as reducing the corporate income tax and tax breaks for manufacturers only sound good without doing anything specific to a deal.
This is just another thing, Im not saying its bad, Im not there yet, I just dont view this as being terribly thoughtful in a way that is targeted on a deal flow, Ring said.
In addition to further incrementally reducing taxes on the purchase of equipment by manufacturing companies and the corporate income tax rate, Scott wants the manufacturers who receive the break to see a reduction in paperwork required.
Sen. Thad Altman, R-Melbourne, stood up for the measured tax plan, saying executives in the aerospace industry view the reductions as a means to allow them to advance high-tech manufacturing jobs to the area.
I think this is the proper approach, a gradual drawdown in the corporate tax and hopefully it will go away, Altman said.
Scott's chief economist, Christian Weiss, offered no doubt that the governors policies have contributed to the drop in unemployment, claiming that finance experts believe sales tax should only be imposed on the final consumer purchase, otherwise the cost is passed down the line to the final buyer.
Committee Chair Sen. Dorothy Hukill, D-Port Orange, said the committee will begin to review tax exemptions and tax credit provisions designed for economic development next week.
Reach Jim Turner at jturner@sunshinestatenews.com or at (772) 215-9889.
