County frets over proposed communications tax
Published: Tuesday, March 5, 2013 at 7:11 p.m.
Last Modified: Tuesday, March 5, 2013 at 7:11 p.m.
County officials on Tuesday expressed concern that a measure in Tallahassee could lower the amount of money Alachua County collects from cellphone, Internet and cable television usage.
County and city governments now set their own communications service tax rates, and collect the levy on top of the state’s communications tax. That means there are hundreds of rates throughout the state.
HB 303, introduced by state Rep. James W. Grant, R-Tampa, would repeal local governments’ authority and raise the state’s tax from 6.65 percent to 10.65 percent. After deducting money for funding education, the state then would distribute 45 percent of the revenue to the counties and cities.
Alachua County has one of the highest communications service taxes, or CST, in the state. It was unclear on Tuesday how much revenue it generates, but any reduction in the amount would impact the 2013-14 budget being developed.
The county agrees with simplifying the tax, said Mark Sexton, communications coordinator for Alachua County, with one major condition.
“The county will support it as long as the revenue sharing gives the county as much as it is currently collecting,” he said. “Alachua County supports a revenue-neutral compromise,” he said.
At their regular policy meeting Tuesday, county commissioners discussed the difficulties of planning a budget without knowing how much revenue they will receive.
Commissioner Charles “Chuck’’ Chestnut said the legislation seemed to have been the idea of communications giants like Verizon and AT&T.
The county seemingly has reason to be concerned.
In an interview, Grant said that counties like Alachua whose communication services taxes are higher than the proposed 4 percent increase in the state tax will likely see a cut in revenue.
Grant said this is fair because services like the Internet were never intended to be taxed as they are, adding that the tax cut in counties like Alachua will help residents.
He said the notion that the bill was drafted to please telecom companies is not true.
“It was drafted with families and consumers in mind,’’ he said.
The tax, originally intended for landline phones, has evolved over the last decade to cover Internet use, cable television and mobile phones, said Cragin Mosteller, communications director for the Florida Association of Counties.
The FAC is closely watching this bill, she said, adding that it is one of its top three priorities this year.
“It’s a $250 million issue,” Mosteller said.
The FAC hasn’t taken a stance on it yet, since the details are still being developed. One critical factor will be whether it will affect the revenue Florida’s counties collect, she said.
The Florida League of Cities opposes the bill, citing similar concerns about the lack of a distribution formula, according to Amber Hughes, a legislative advocate for the League of Cities.