Lease tax cut to save 'thousands'

t's only a two-tenths of 1% cut, but the decrease in Florida's lease tax rate could save some commercial real estate tenants thousands of dollars annually.

That's the conclusion commercial real estate brokerage firm Cushman & Wakefield gave in a report issued late last year.

The reduction, to 5.8% as of Jan. 1, applies to all businesses that pay rent on commercial space. The rate is based on when properties are occupied.

“For some tenants with extremely large leases, say 10,000 square feet, 25,000 square feet or 100,000 square feet, you're talking a reduction of several thousands dollars,” says Chris Owen, Cushman & Wakefield's Florida research manager.

“It shows Florida is taking a more competitive approach.”

The cut by the Florida Legislature in 2017 came in response to several states' decision to either eliminate or limit the amount of tax that companies pay on leases.

Owen notes too, that the reduction in corporate occupancy costs benefits investors as well as occupiers, and could spur further investment sales in the year ahead throughout the Sunshine State.