2023 Florida Sales Tax Update - Key Changes

Businesses in The Sunshine State need to stay vigilant about sales tax updates to avoid getting on the bad side of the law. This is easier said than done because the local government annually passes a brand new set of laws that update the Florida Tax Naples, FL, including the use and sales tax - some of which are permanent. 

As one of the most famous Florida tax lawyers, here at Jostock & Jostock, we’re always happy to provide advice to business owners regarding tax matters, so feel free to reach out to us if you have any questions regarding the Florida Tax Naples, FL update 2023.

Now, without further ado, here are the latest changes to the tax package.

1. Local food and beverage tax

According to this statute, if the governing authority of a city or a town adopts an ordinance approved by registered voters, they can impose optional updates to the local beverage and food taxes.

2. Real estate property and use tax rates

From December 1, 2023, the commercial real property use and sales tax rate will be significantly reduced from the previous 5.5% down to 4.5%. This doesn’t include county tax rates on commercial real estate rental which remain unchanged. 

3. Referendums for local sales tax

Regarding local sales tax, new wording was added that clarifies the fact that the referendum to reimplement an expiring tax has to be held through a general election within a 48-month period, which immediately precedes the effective date of the tax. The referendum has to appear on the voting ballot at least once while the 48-month period is in effect. 

4. Tax exemptions

A variety of sales tax exemptions were updated this year, which include:

• Agricultural items utilized for constructing or repairing temporary or permanent fencing used to confine and contain cattle such as gates, as well as energized fencing systems. Lands classified as being used for agricultural purposes are eligible for this exemption.

• Equipment for renewable natural gas such as landfill gas and wastewater gas consisting of up to 90% methane content, and anaerobically generated biogas. The equipment exempt from taxes must be primarily used in the production, storage, compression, or transportation of these gasses and must be installed in a fixed location.

• Baby products such as baby cribs, play yards, strollers, and playpens. Furthermore, the list of products also includes safety products such as child safety locks, socket covers, baby monitors, and others, along with products like breast pumps, bottle sterilizers, pacifiers, diapers, and so on. Moreover, also included in tax exemptions are covers, clothing, shoes, and apparel marketed for children up to age 5 (size 5T clothing and shoes sized 13T).

• Oral hygiene products including manual and electric toothbrushes, dental floss, and picks. This also incorporates toothpaste, mouthwash, and oral irrigators.

• Firearm safety products are not only exempt from sales tax but use tax as well. This includes firearm safes and lockboxes, firearms cases, trigger and cable locks, together with other devices used to store weapons that use a combination or a key to unlock.

• Services by private investigative agencies are now exempt from sales tax if the agency employs three or fewer employees.

5. Temporary tax exemptions

The last update concerns temporary tax exemptions such as the Back-to-School sales tax exemption which runs from July 24 through August 6 of this year, and January 1 to January 14, 2024. 

While these exemptions can be leveraged by all kinds of businesses, they don’t apply to theme parks or entertainment businesses situated in airports or public lodging establishments. 

The following items are exempt during these timeframes:

• Clothing, bags, and wallets. This doesn’t include suitcases, briefcases, or garment bags, only bags such as handbags, fanny packs, and backpacks priced under $100. When it comes to clothes, any article intended to be worn on the human body is exempt from the sales tax including shoes. Items excluded from this list are watches, jewelry, watchbands, skis, roller blades, skates, and swim fins.

• School supplies under $50 per item. Some of the items include pens, erasers, notebooks, legal pads, lunch boxes, folders, markers, poster paper, calculators, computer disks, staplers, etc.

• Jigsaw puzzles and learning aids priced under $30. Learning aids in this context refer to flashcards, memory games, search-and-find books, and electronic books aimed at increasing math or reading skills, as well as nesting or stacking blocks. 

• Personal computers and equipment for personal use under $1.5k. Some of the items include laptop and desktop computers, electronic book readers, tablets, and handhelds. Equipment exempt from sales tax also covers monitors, keyboards,, and other peripherals, routers, and relevant software. Items not included are phones, digital media receivers, gaming consoles, and peripherals designed for recreational use such as gamepads or VR headsets. 

Can You Opt Out?

It’s worth noting that sellers have the option of opting out if their gross sales in the previous year consists of any items covered by temporary tax exemptions mentioned above. Although the deadline for the July tax holiday has already passed, if you want to opt out of the January 1 tax holiday, you can do so by notifying the Florida Department of Revenue by December 23. 

You are also required to post a copy of the notice that the business doesn’t offer exemptions in a conspicuous place.

Keeping Up With The Changes

If any of the sales tax updates affect your business, you need to make sure you stay compliant with the law and safeguard your business from any costly violations. With so many things to keep in mind, this can be especially tough for small businesses. 

Fortunately, attorneys at Jostock & Jostock are professionals in all facets of commercial business transactions and we can help you deal with the changes in Florida sales taxes. We’ve been operating in Naples, Florida for over six decades, and during that time, we counseled a wide range of clients - from small businesses to large corporations - in regards to their tax issues. 

Our main goal is to provide outstanding service and legal expertise of the highest standard, thus helping our clients achieve their goals stress-free. 

Get in touch with one of the best Florida tax lawyers in Naples and beyond by calling (239) 500-8822 or using our contact form.

Note: 

The information in this blog post is for reference only and not legal advice. As such, you should not make legal decisions based on the information in this blog post. Moreover, there is no lawyer-client relationship resulting from this blog post, nor should any such relationship be implied. If you need legal counsel, please consult a lawyer licensed to practice in your jurisdiction.