Governor Ron DeSantis has pledged to eliminate the state’s business rent tax, which is unique to commercial property rentals in Florida.
During his 2025 State of the State address on March 4, DeSantis stated that eliminating this tax would save businesses an estimated $1.6 billion per year, further boosting the state’s expanding economy.
A Targeted Tax Cut for Competitive Advantage
Florida remains the only state in the country that taxes business rent. Although the rate was reduced from 4.5% to 2% during the previous legislative session, Governor DeSantis argued that it was time to completely eliminate the tax.
“Florida remains the only state in America to tax business rent—and while we have reduced the rate of the tax it is time to eliminate it,” according to what he said.
The proposed tax cut is part of a larger “Focus on Fiscal Responsibility” agenda for Florida’s 2025-2026 budget, which aims to attract new investment and promote business growth.
Economic Impact: Growth Fueled by Influx and Tourism
Governor DeSantis cited the large influx of new residents and businesses as a key driver of Florida’s rising GDP.
He emphasized that tourism continues to be a significant economic driver for the state. In 2024, Florida welcomed over 142 million visitors, including 3.3 million from Canada, demonstrating the state’s enduring appeal.
“Not much of a boycott. Perhaps they wanted to see what a Stanley Cup-winning hockey team looks like.” DeSantis joked, emphasizing the various factors that contribute to Florida’s economic resilience.
Balancing Savings with Revenue Implications
While the proposed elimination of the business rent tax is expected to relieve financial burdens on business owners, it would also reduce state tax revenue by the same amount.
However, DeSantis believes that the overall increase in investments and economic activity will more than offset the shortfall. The governor’s tax relief initiative is intended to create a more business-friendly environment that not only attracts companies but also encourages them to invest more in the state.
A Broader Agenda for Fiscal Efficiency
The tax relief measure is only one component of a comprehensive reform agenda. In a related initiative, Governor DeSantis recently established a “state DOGE task force”—a program inspired by spending cuts implemented by previous federal administrations.
The task force will look at about 900 state positions, university expenses, local government spending, and approximately 70 state boards and commissions. “For too long, nobody has cared about taxpayers, much less the next generation,” DeSantis said, emphasizing the importance of fiscal discipline in government operations.
As Florida develops as a business and tourism hub, the elimination of the business rent tax is expected to play a critical role in fostering a culture of growth and efficiency.
