Earlier this year, the Florida legislature passed a $1 per pack tax hike on cigarettes. After years of being a model to other states by avoiding tax increases, they caved on this $2 billion tax on cigarettes and Governor Crist joined them when he signed the bill.
During the 2009 session there was also an attempt to allow for a $2 a day surcharge tax increase on rental cars. The rental car tax was defeated in the spring, but appears to be the target of a possible special session this December or January.
Now, the state looks to be hunting for the rental car surcharge tax again. The Governor is proposing sending the opportunity to hike taxes on rental cars to the people of south Florida. Tri-Rail, the commuter rail that is looking for funding to keep going is where they are looking to direct this tax revenue. Whether or not Florida can keep Tri-Rail fully funded seems to be a test as to whether or not they can apply for federal stimulus dollars for more light rail and high speed rail projects. If the federal government provides money to build more rail projects, will this only magnify the situation that Florida is now facing with Tri-Rail?
Florida is not in a good budgetary situation at the moment. In fact, earlier this year they raised taxes on cigarettes by an estimated $2 billion a year. With this said, the legislature may soon be looking to raise another tax in this calendar year. This time the tax would be on one industry (rental car companies), so they can fund another seemingly failing project (Tri-Rail). Hopefully state legislators in Florida will stop before voting for a tax increase (including allowing counties to vote for tax increases). Also, they have to look at what will happen if they do win the federal "stimulus" dollars and how they will pay for these rail projects down the road if they don’t pay for themselves. The worst case scenario would be that they have to beg the taxpayers of Florida for public subsidies through more tax increases. One has to ask, how can they be thinking of building more subsidized rail, when they are already pursuing new taxes for the Tri-Rail system that cannot pay for itself?
Additionally, this puts Gov. Crist in a tight spot. Supporting taxes by passing responsibility of tax hikes to voters and signing a tax hike into law aren’t a whole lot different. They both are taking hard earned dollars from taxpayers and supporting at the very least an opportunity for tax hikes. Either way, he would be violating the Taxpayer Protection Pledge for the second time in one year. Hopefully the Governor will hold true to his commitment to the people this time, the commitment that he made when he signed the Taxpayer Protection Pledge saying he would oppose and veto any tax increase.
To see ATR’s press release from when Gov. Crist broke the Pledge earlier this year, click here.
To see ATR’s press release encouraging a NO vote on anything that would contain a tax increase or allow for a tax increase, click here.
To see ATR’s letter opposing any kind of tax increase in a special session bill, including that of a rental car tax hike, click here.
Photo credit: (Three_if_by_Bike)