ORLANDO, Fla. — Tenants renting commercial property in Central Florida will soon be able to receive a break on sales taxes that are assessed as part of their lease.
What you need to know: Starting June 1, the tax rate on commercial property rentals statewide will be reduced from 4.5% to 2%. The tax cut was originally scheduled to take effect on July 1. The tax cut does not apply to rentals of living, sleeping or lodging facilities for six months or less, and commercial parking or storage space for boats or automobiles.
Starting June 1, the statewide tax rate on commercial property rentals will be reduced from 4.5% to 2%.
The cuts were originally scheduled to take effect on July 1st.
Amy Calandrino, a real estate agent with Beyond Commercial, said she believes the rate cuts will bring in more business, including from out of state.
“I think this will be a welcome relief for many tenants, including those who live outside of Florida,” Calandrino said.
She said the tax cuts could make a big difference, especially for people who pay a lot of money in rent for commercial property.
“If you're paying $100,000 in rent, that's a lot of money you can put towards your business and other things in your portfolio,” Calandrino said.
Mike Van Den Abeel, owner of Mosaic Hair Studios, which owns two different storefronts, said the rental property tax cut would really help small business owners.
“So I think it's important that when Tallahassee does something, it's not just for a few specific players or special interests, but that it's actually for the benefit of everyone,” van den Abeel said.
The owner, who employs more than 50 people and plans to open a third store in Winter Garden, said he was attracted by high rents and low taxes in Central Florida.
“Rents in Winter Garden are astronomical,” Van den Abeel says. “I think the last lease I heard was $50 a square foot.”
The reduced sales tax rate on commercial rental property does not apply to state sales tax rates on the rental or lease of living, sleeping, or household accommodations for six months or less.
The change also does not apply to commercial parking or storage spaces for boats or automobiles.