Under Scott, fewer businesses pay corporate income taxes

Gov. Rick Scott continued chipping away at Florida's corporate income tax in his second go-around with the Legislature.

Unlike last year, when he unsuccessfully lobbied lawmakers for a 3 percent reduction of the 5.5 percent overall rate, Scott left the rate alone and instead worked on removing more businesses from the tax roll.

In 2011, lawmakers granted him an exemption for businesses owing up to $25,000 in corporate income taxes -- up from $5,000. This spared 8,351 businesses from paying that tax, according to the Office of Economic and Demographic Research.

Scott kept going with that in his 2012 tax strategy. The Legislature agreed to double the corporate income tax exemption to $50,000, sparing 3,894 of the businesses left on the tax roll. The approximate cost to the state: $30 million.

This measure and other breaks amounted to a $150 million tax relief package from Scott.

Another of Scott's targets was the tangible personal property tax. Scott asked lawmakers to eliminate this tax for businesses that own less than $50,000 in equipment and other property.

The Legislature approved this as a constitutional amendment for the 2012 ballot, so voters will get the final say.

Scott says it will exempt half, or about 150,000, of the businesses that usually pay this tax, and the loss to the state is about $20 million in 2013.

Other breaks Scott sought and got: a $54.4 million break for manufacturing equipment and a $12.3 million break for private planes.

Scott has said jobs will "grow like crazy” as a result of tax cuts that make Florida more business friendly.

But one of Scott's top advisers acknowledged immediate job growth isn't likely as a result of tax breaks here and there.

"Quite frankly, depending on the size and scope of the company, their savings and tax breaks might not be enough to bring a new person on," legislative affairs director Jon Costello said in a fall 2011 committee meeting. "But it might be enough to buy a new piece of equipment or do something that injects money back into the economy."

According to his budget website, Scott plans to ask the Legislature to exempt the remaining 10,000 businesses that owe corporate income taxes in "2013 and beyond.”

Scott's business-friendly tax breaks play well with conservatives but anger folks on the other side of the political spectrum, like ThinkProgress.org and the left-leaning Florida Center for Economic and Fiscal Policy.

Scott's effort to reduce the corporate income tax is like former Gov. Jeb Bush's phasing out the intangibles tax, which cost the state $2 billion in lost revenues, said FCFEP executive director Karen Woodall.

"We're not going to have adequate sources of revenue to meet the needs of the state,” she said.

Scott has moved more than half of the businesses from the corporate income tax pay roll, and he doesn't plan to stop there. We're moving his promise from Stalled to In the Works.

Times/Herald staff writer Toluse Olorunnipa contributed to this report.