Florida expects $2.77 billion revenue increase into 2025
Eric Daugherty contributed to this report.
TALLAHASSEE, Fla. (FLV) – Florida economists have projected the state will see a revenue boom of $2.77 billion across the next two fiscal years, according to a report from the General Revenue Estimating Conference.
Despite economic hurdles that include increased use in credit and ongoing spending patterns, as well as inflationary concerns, actual revenue collections outpaced expectations compared to the previous conference.
The projection also simmered some concerns of a mild recession in the first and second quarters of 2023, contradicting a previous report from February. Part of the recession’s failure to transpire was due to surpassed revenue collections since February’s conference.
In all, revenue collections produced a 2.3% increase, or around $1.083 billion, across all sources.
The conference issued a revised projection of $1.57 billion for fiscal year 2023-2024 following $1.02 billion in tax relief measures from the 2023 Legislative Session.
Growth in FY 2024-2025 from 2023-2024 is expected rise by 3.9%, resulting in the state’s surplus over the two fiscal years. Previous figures projected a 3.6% increase in FY 2023-2024 and 2.6% uptick in 2024-2025.
Future revenue gains from the state sales tax are also expected.
Economists projected Florida to garner $907.6 million in sales tax revenue in Fiscal Year 2023-2024 and another $615.1 million in FY 2024-2025. All six categories of sales tax are expected to surge over both fiscal years.
Aside from the sales tax, the report indicated the greatest profit from the Documentary Stamp Tax. Economists projected gains from the tax to total $256.8 million in FY 2023-2024 and $160.3 million in 2024-2025.
Additional revenue is also expected from the Intangibles Tax with $99.1 million in fiscal year 2023-2024 and $48 million in 2024-2025. Expected gains in corporate income tax and earnings on investments are also projected.
As part of Florida’s budget, Gov. Ron DeSantis touted the state’s $2.7 billion in tax cuts for Floridians.
“That’s a record by far,” DeSantis said. “Last year, we did $1.2 billion, which was the record for Florida and so we more than doubled last year’s record.”
The report also comes as Florida’s AAA credit rating was reaffirmed by Fitch Ratings, a credit rating agency that anticipates Florida revenue to outpace inflation.
The group gave multiple reasons for handing Florida the best credit rating, one being the state’s “continued economic and population growth,” which Fitch said is a prime factor in their assessment that Florida’s revenue will outpace U.S. inflation over time.
Other actions cited include tax cuts for things like baby and toddler products, approving raises for state employees, investing in local preservation, accelerating infrastructure improvements and more.
“Today’s announcement reinforces that Florida’s track record of conservative policy, early debt repayment, and strong reserves is the blueprint for states and the federal government to follow,” DeSantis said when Fitch released this year’s rating for Florida.
