2021 How Florida Compares: Taxes

Key Figures & Findings

• Florida continues to be a relatively low tax state, with extremely low per capita* state taxation but considerably higher local taxes.
• Although Floridians’ “Per Capita State and Local Own Source Revenue**” increased by $178 (2.8 percent), it shrank relative to other states. Nationally, growth was nearly twice that of Florida and the national average rank fell one spot to 39th (see p. 8). Florida highest ranking was 22nd (2006) and it lowest was 40th (2016).
• Floridians’ “Per Capita State and Local Tax Collections” ranking (a narrower measure of how much taxpayers pay for their government) dropped to 45th in FY2018-19 (see p. 12).
• The effect of COVID-19 on government revenue is only starting to be reflected, but only for state tax collections, for which FY2019-20*** data is available (combined state/local data is FY2018- 19). The pandemic reached Florida late in FY2019-20 and its impact was immediate and severe—per capita state tax collections fell by 4.9 percent in FY2019-20. The impact on other states—on average—was less than in Florida. The U.S. average fell by 1.9 percent.
• Florida no longer has the lowest “Per Capita State Tax Collections” ranking in the nation as that spot is now occupied by Alaska, thanks to that state’s plummeting state tax burden due to its reliance on non-tax oil royalties. While Florida’s rank rose one spot to 49th, its per capita amount still decreased by just over $100 per Floridian. When all state government own source general revenue is included, Florida’s ranking also stands at 49th (see pp. 22-23).
• While Florida’s state tax and revenue burdens are very low compared to the other states, its local tax burdens are much higher. Florida’s “Per Capita Local Own Source Revenue” and “Per Capita Local Tax Collections” rank 15th and 28th, respectively (see pp. 40-41).
• Florida relies more heavily on local revenue to fund government than any other state. Florida local governments account for 54.6 percent of Florida’s total state and local revenue, the highest percentage in the nation and 21.9 percent above the U.S. average (see p. 15).
• Florida’s per capita property tax ranking is just above the median—24th (see p. 42). After reaching as high as 12th, the housing bubble burst led to falling property tax collections, dropping the rank to 26th in 2014. Florida’s ranking has remained stable the last few years.
• Florida also classifies 38.6 percent of its state and local own-source general revenue as non-tax revenue, the 9th largest percentage in the nation (see p. 17). Nearly half (46 percent) of local own-source revenue is classified as non-tax, highlighting Florida local governments’ use of special assessments, charges for services, and impact fees.
• Florida relies more heavily on transaction taxes than most states. Transaction taxes (general and selective sales taxes) account for 81.5 percent of all Florida’s state tax collections, compared to the national average of 48.2 percent (see p. 24).
• Florida’s state selective sales (excise) tax ranking has dropped from 19th in 2006 to 41st in 2020, mostly due to alcoholic beverage tax collections, which used to be among the highest in the nation. Gross collection liability is still rising, but the credits from the Florida Tax Credit Scholarship Program now total $475 million annually (almost 60 percent of liability).
• Florida’s “State & Local Cell Phone Tax Rate” of 14.89 percent is the 13th highest in the nation, higher than both the U.S. Average of 12.82 percent and Florida’s average state and local general sales tax rate of 7.08 percent (see p. 19).
• Florida’s housing sector also produces significant revenue for the state and the documentary stamp tax is one of the state’s major tax sources. Florida’s collections are rising steadily over the last decade and stand at $154 per capita in 2020, the nation’s third largest burden (see p. 33).
• Florida is one of seven states without a personal income tax. The average state relies on personal income taxes for 36.4 percent of its tax revenue (see pp. 24 and 28).
• Businesses pay more than half (53.0 percent) of all state and local taxes in Florida. This is the 9th highest percentage in the nation and higher than the national average of 44.0 percent (see p. 18).

Important Notes

• Per capita amounts are calculated using state population estimates from the U.S. Census Bureau. Fiscal year (FY) population is estimated by averaging the July 1 population for the two years that contain the FY. For example, FY2019 is the average between July 1, 2018 and July 1, 2019.
• ** “Own source revenue” is a broader measure of the financial burden citizens incur to pay for their government. It counts all direct revenue, including taxes and non-tax revenue such as charges for services, special assessments, impact fees, and net lottery revenue. It does not include intergovernmental aid, revenue from government-owned utilities and liquor stores, and social insurance funds. The revenue Florida reports to the U.S. Census Bureau as taxes is much lower than official state data.
• *** Fiscal years in this pocket guide refer to the fiscal years of each state, which may vary slightly. Forty-six states, including Florida, have state fiscal years that run from July 1 - June 30. Florida’s local governments’ fiscal year runs from October 1 to September 30.

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