Did you know that the state of Florida is the only state in the country that charges a sales tax on all commercial leases regardless of the size or amount of the lease? This is true and it has been argued by members on the Board of Realtors and even by the former Governor and now Senator of the State of Florida Rick Scott. Fortunately, for the last couple of years we have seen minor decreases. We have seen the State Sales Tax on Commercial Leases in Miami Dade County decrease from 7% to 6.5%. It isn’t a huge difference but any decrease is always welcome. Of course, the ideal scenario would be to eliminate it completely.
How can that affect the rent payment? Let’s see an example: If we look at the percentage decrease from a tenant’s point of view this could be a savings of $100.00 a month if the tenant is paying $20,000 a month as base rent. That is a savings of $1,200 a year that can be invested back into the company and in an area of the business that will produce a higher revenue or paid out as benefits or bonuses to its employees.
Unfortunately, the proposed new tax cut was NOT approved in the state of florida but we will keep hopeful for the following year. Therefore, Tenants should keep an eye out for their savings and Landlords please do not forget to confirm and make the proper adjustments when collecting rent. We at Aim Higher Commercial Real Estate Group like to keep our tenants and landlords up to speed when it comes to everything related to commercial leases. We will be sending out informative reminders before the end of the year 2020. If you would like to be included in this email blast, send us a message and we will gladly add you to our reminders list.