Gov. Rick Scott's $1 billion tax-cut request is giving the Florida Legislature plenty to chew on, especially after state economists warned that revenues won't be as high as once thought.
Scott wants a range of cuts, including a reduction in the sales tax on commercial rents and a $770 million break for manufacturers and retailers by getting rid of their corporate income tax. Despite concerns over how the size of his request will affect the budget, Scott was confident the math makes it an easy decision for lawmakers.
"We have plenty of money to be able to do tax cuts," Scott said Jan. 20, after state economists warned tax revenues would be less than previously estimated. "Let's look at history. We've cut taxes 50 times, and look what has happened to our revenues. They've grown."
Scott has used this line repeatedly in recent weeks. We wondered whether revenues have continued to grow even as Tallahassee has passed tax changes over recent years.
Scott's line about 50 tax cuts is a talking point that just keeps on growing. We have rated the claims about him making 24 tax cuts, 40 tax cuts and more than 40 tax cuts, Half True, because Scott counted many small tax changes for specific industries as overall tax cuts.
What's new this time around, in a nutshell, are 16 provisions passed in 2015, most of which were part of a $429 million tax-cut package. The full list is largely comprised of esoteric tax credits (mostly for businesses), changes in unemployment compensation and sales tax holidays. There also was a rate reduction on the Communications Services Tax on cellphone and cable service that amounts to about $21 per $100 on a bill and a $60,000 cap on taxes for boat repairs.
Several of those may help businesses but really don't often do much for everyday Floridians, especially if they needed to collect unemployment. Many times, local governments may raise taxes to make up for their own lost revenue.
In short, it's arguable whether all of those qualify as tax cuts, but they did have an impact on how many tax dollars the state brought in. Economists told us, however, that while you can project how much year-over-year revenues may be changed from cuts, it's tough to attribute any concrete economic growth to those changes.
Because of overall economic growth, general tax revenues have been rising since Scott became governor as the state was climbing out of the Great Recession, when those revenues had dipped.
During Scott's first full fiscal year in 2011-12, general revenue clocked in at $23.6 billion, growing at a 4.7 percent rate. The climb escalated in the ensuing years and stood at $28.4 billion for 2015-16. This year's estimated growth rate, however, is down to 2.1 percent.
State economist Amy Baker noted that even with Florida's economy growing, that growth rate is currently below the state's historical average, and the cumulative effects of prior tax changes are eating into revenues more than expected.
It's clear revenues have gone up even as Scott's tax changes have been implemented, but experts said it's tough to directly link them. They said there are three main reasons Florida's revenues have grown during the nationwide recovery: Population growth, rising property values and overall inflation.
More than 1 million people have moved to Florida since 2010, property values are recovering from the housing bust, and inflation makes tax collections go up as costs go up.
Norton Francis, senior research associate with the Urban-Brookings Tax Policy Center, said that despite being the third-largest state, the growth rate for Florida's tax revenues has started to lag behind the national average.
"What you need to look at is, are (tax revenues) growing more than they used to?" Norton asked. "It could be that it's come back as a whole, but it's hard to pin that to a tax cut."
Scott has a debatable definition of tax cuts, but the state's tax revenues have increased since he took office. Economists told us it would be difficult to attribute growth specifically to tax changes. We rate the statement Mostly True.
Read more rulings at PolitiFact.com/florida. Contact Joshua Gillin at [email protected] Follow @jpgillin.