Florida’s Internet sales tax

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According to NOLO, the online legal encyclopedia, “The Internet takes tax-free shopping to a new level. In fact, no-tax shopping has become a prime lure of online retailers looking to hook consumers on click-and-charge buying. Despite what you sometimes hear, however, some Internet sales are subject to sales tax, and even when a site doesn’t collect sales tax, consumers are technically responsible for remitting any unpaid sales tax on online purchases directly to their state.”

For information on the Internet sales tax laws for each state, see NOLO’s Internet Sales Tax: A 50-State Guide to State Laws.

NOLO states, “The current default rule throughout the United States is that you must collect sales tax on Internet sales to customers in those states where your business has a “physical presence.” The physical-presence rule is based on a 1992 United States Supreme Court decision, Quill Corp. v. North Dakota, that addressed the obligations of mail-order businesses to collect sales tax on out-of-state sales. The decision has been extended to include online retailers.”

NOLO reports in its column “Florida Internet Sales Tax“, “A more specific statement of what counts as physical presence under Florida law can be found among the various definitions of “dealer” (meaning a person or entity required to pay sales tax) in Section 212.06 of Florida’s sales and use tax law. More particularly, a ‘dealer’ under this law includes ‘any person . . . who maintains or has within [Florida], directly or by a subsidiary, an office, distributing house, salesroom, or house, warehouse, or other place of business’.”

Senator Nancy Detert, R-FL District 28.

Senator Nancy Detert, Florida District 28, introduced SB 0316: Taxes. SB 0316 states:

Taxes; Reducing the tax rate applied to the sale of communications services; reducing the tax rate applied to retail sales of direct-to-home satellite services; revising the term “mail order sale” to specifically include sales of tangible personal property ordered through the Internet; providing that certain persons who make mail order sales and who have a nexus with this state are subject to this state’s power to levy and collect the sales and use tax when they engage in certain enumerated activities, etc.

NOLO notes that in 2012:

“The Florida legislature recently considered amending the state’s legal definition of a mail-order sale so that Internet “dealers” who do not have a physical presence in the state would nonetheless have to pay Florida sales tax. Laws of this sort have been considered in various forms in various states. They are sometimes referred to as “Amazon laws.”

[ … ]

More particularly, earlier this year the Florida legislature considered amending the state’s sales and use tax law to require out-of-state “dealers” without a physical presence in Florida, but with so-called “click-through” arrangements with persons in Florida, to nonetheless collect sales tax. Such a dealer would need to collect sales tax from Florida customers if that dealer:

  • had an agreement with one or more Florida residents to direct potential buyers to the dealer via a website link
  • compensated the Florida residents for directing potential buyers to the online dealer, and
  • the dealer’s “cumulative gross receipts” from such directed sales to Florida customers exceeded $10,000 within the preceding 12 months

However, the proposed legislation was never enacted. It remains unclear whether similar legislation will be re-introduced in the future.

We know that Senator Detert did introduce this legislation during the 2013 session.

Final Words from NOLO:

The issue of whether to require online retailers to collect sales tax in a state where they have no physical presence has been a matter of ongoing debate. At this time, however, Florida has not enacted any law that would require such retailers to collect sales tax from Florida customers.

In Florida, the physical-presence rule continues to apply for Internet retailers. However, because the issue remains contentious, you should consider checking in periodically with the Florida Department of Revenue to see if the rules have changed. Also, for more general information on taxes on Internet sales, see Nolo’s article Sales Tax on the Internet.

Tax Collector answers questions about taxes in Florida

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Barbara Ford-Coates

April is National Tax Burden Month. WDW – Florida has asked a tax collector to answer some questions about taxes in Florida. We want to thank Barbara Ford-Coates, Florida Tax Collector serving Sarasota County, for providing answers to our tax questions. Since property taxes comprise the largest dollar amount collected, the below answers from Barbara Ford-Coates address those taxes.

1. What kind of role do you play in shaping or implementing Florida’s tax policy?

The Florida Legislature has the primary responsibility for the state’s tax policy. The Tax Collector’s role is to advise the State on the most efficient way to implement the final law. [E.G.  Florida Tax Collectors recently worked to give taxpayers the option of receiving their tax bill(s) electronically.]

2. What are some of the most common misconceptions citizens have about Florida state taxes?  What are some of the most common mistakes you see citizens make when filing their tax returns?

One misconception we hear about relates to the time period. Since Florida taxes are collected in arrears, taxpayers sometimes believe they are paying the following year’s taxes. As an example, the 2012 tax bills were mailed around November 1st of 2012 and were payable through March of 2013.   A taxpayer who paid the bill in March of 2013 may have thought they were paying the 2013, rather than 2012 tax bill. The most common mistake we see is sending the wrong amount.

3.  How do incentives work? Credits? Sales tax holidays? Do you think these help Florida?

Tax collectors have no involvement in incentives, credits or sales tax holidays.

4.  How can we make Florida’s tax code simpler and more citizen-friendly? What changes would you suggest?

I think the concept of a locally elected official (Tax Collector, Property Appraiser etc.) working to implement State tax laws provides the best opportunity for citizen-friendly administration.  As an elected official, I have both a duty to the state and the taxpayer. As such, I must always work to make paying taxes as simple and easy as possible for the taxpayer.  In that role I can and do advise the state how to improve the process.

5.  Is your agency doing all it can to collect the taxes it is owed?  What is the consequence for not paying Florida taxes on time?

Within a year of receiving the property tax roll from the Property Appraiser and the non-ad valorem districts, we collect over 99.5% of the roll. Of the remaining unpaid taxes, we continue our focused efforts (selling tax certificates, field visits) to collect the rest.

Failure to pay real estate taxes on time results in additional costs to the taxpayer. If the taxes remain unpaid two years after the date of delinquency, the taxpayer is at risk of losing their property. Delinquent real estate taxes are primarily collected through the sale of tax certificates (tax liens) to investors who pay the tax in exchange for having a lien on the property. Unpaid tangible taxes also result in additional penalties and interest to the taxpayer.  Delinquencies are collected through a variety of enforcement efforts that include the issuance of warrants, field visits, contacts by phone, email and correspondence, and the sale and seizure of assets.

The state agency that deals most with Florida taxes is the Department of Revenue.

WDW- Florida provided James McAdams, Director Property Tax Oversight, these same questions. Director McAdams provided this reply, “Thank you for the opportunity to participate in your article about tax administration. Since the Department of Revenue does not play a role in the development of tax policy your invitation would be more properly directed to members or staff of the Florida Legislature.”

A copy of this column has been sent to Governor Rick Scott, the Florida Cabinet and all Florida legislators.

Tax Day 2013: America waking up with a case of an in the red Monday

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The following is courtesy of the Heritage Foundation:

Americans are waking up today to the worst “case of the Mondays” they’ll have all year: It’s Tax Day.

Most Americans dread Tax Day, and for good reasons. Beyond the huge tab Americans pay to the government, the tax code is so complex that it’s difficult to figure out what we owe to the IRS. This is a pain for taxpayers and a huge drain on the economy.

According to the federal Taxpayer Advocate in its 2012 report, Americans’ cost of complying with today’s complex tax code totaled $168 billion in 2010. That’s almost as large as the impact of the Obama tax hikes in fiscal year 2013, and twice the size of sequestration this year [see chart].

It takes taxpayers 6.1 billion hours—or 51 hours per household—to complete all the required filings. That’s more than six full eight-hour working days per household!

The compliance burden comes on top of the direct financial cost of $3.5 trillion in federal spending. In 2012, Washington collected $20,000 in taxes for every household in America. But Washington spent nearly $30,000 per household.

TaxDay_403

Americans pay high taxes as it is, and with the 13 tax increases that hit this year, tax revenue is growing beyond its historical average as a share of the economy. But Washington’s deficits continue, because spending keeps going up.

Future Tax Days promise to be even worse because of the tax increases from the fiscal cliff deal and from Obamacare. Taxpayers will start seeing these costs when they do their tax returns next April and in future years.

Too much taxing and spending is bad for the nation. Americans are right to be concerned about how the President and Congress allocate their hard-earned money. As the above infographic shows, 45 percent or almost half of all spending went toward paying for Social Security and health care entitlements. Without reforming these massive and growing programs, Washington will have to borrow increasing amounts of money, piling debt onto younger generations and putting the nation on a dangerous economic course.

Growing government spending threatens current and future taxpayers with higher taxes. Congress should reduce spending and prevent any more tax increases. Congress also needs to reform the tax code so it is less of a burden on the American people.

Tax day is a real drag, but it doesn’t have to be this bad. Learn more at savingthedream.org.

Read the Morning Bell and more en español every day at Heritage Libertad.

Bring it on! Let’s talk fairness in tax policy (+ video)

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April is National Tax Burden Month. As part of the WDW – Florida campaign to educate you, the taxpayer, on issues surrounding the tax debate we provide this column on “tax fairness”.

What does fairness mean when applied to federal, state and local tax policy?

President Obama and those in the Occupy Wall Street movement have focused on “fairness” in federal tax policy. Fairness is a word with many meanings and was used to raise taxes on those making more than $450,000. But what is fair?

Recently AFP Foundation Director of Policy, James Valvo, had the opportunity to sit down with Arthur Brooks, President of the American Enterprise Institute. Dr. Brooks shared his insight and research on the moral argument of fairness, and why economic freedom and earned success is the most “fair” concept of all.

In the video below, Dr. Brooks demonstrates what a powerful impact taxpayers can have in framing the debate on tax fairness.

Dr. Brooks uses a human research test to determine fairness as a counter to the current class-warfare rhetoric.  He argues that based on research Americans believe in a system where hard work is valued and rewarded, and that this message can have a tremendous impact if presented in this “real fairness” light.

Watch the video interview with Dr.  Brooks from AEI:

ABOUT AMERICANS FOR PROSPERITY:

Americans for Prosperity (AFP) is committed to educating citizens about economic policy and mobilizing those citizens as advocates in the public policy process. AFP is an organization of grassroots leaders who engage citizens in the name of limited government and free markets on the local, state, and federal levels. AFP grassroots activists advocate for public policies that champion the principles of entrepreneurship and fiscal and regulatory restraint. To that end, AFP supports:

  • Cutting taxes and government spending in order to halt the encroachment of government in the economic lives of citizens by fighting proposed tax increases and pointing out evidence of waste, fraud, and abuse.
  • Removing unnecessary barriers to entrepreneurship and opportunity by sparking citizen involvement early in the regulatory process in order to reduce red tape.
  • Restoring fairness to our judicial system.

Read more: http://americansforprosperity.org/about/#ixzz2QF1dLBD2

ABOUT AMERICAN ENTERPRISE INSTITUTE:

The American Enterprise Institute is a community of scholars and supporters committed to expanding liberty, increasing individual opportunity and strengthening free enterprise. AEI pursues these unchanging ideals through independent thinking, open debate, reasoned argument, facts and the highest standards of research and exposition. Without regard for politics or prevailing fashion, we dedicate our work to a more prosperous, safer and more democratic nation and world.

AEI is a private, nonpartisan, not-for-profit institution dedicated to research and education on issues of government, politics, economics and social welfare. Founded in 1938, AEI is home to some of America’s most accomplished public policy experts.

Read more: http://www.aei.org/about/

Rubio: Obama’s budget is a blueprint for a recession

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Washington, D.C. – U.S. Senator Marco Rubio (R-FL) issued the following statement regarding President Obama’s budget:

“President Obama’s budget is a blueprint for a recession. Filled to the brim with middle class tax hikes and debt spending, the recycled liberal ideas in his budget have failed time and again to create real vibrant economic growth for the American people. Our nation needs a plan that reflects the principles of limited government, free enterprise and a strong national defense.

“President Obama’s plan taxes and punishes American success, and it encourages long-term dependency on government. The President already got $600 billion in tax increases from the fiscal cliff deal struck in January, which I opposed. Now he wants over $1 trillion more in taxes on retirement savings, small businesses and job creators who can’t afford to hire because they’re burdened with new costs as they scramble to figure out just what’s in ObamaCare. It will never even come close to balancing our budget in the next ten years, leaving it up to future generations to figure out how to stop Washington from spending more money than it takes in.

“While the President’s budget attempts to address some of the defense cuts imposed by sequestration, I am concerned that it does nothing to reverse the damaging impact that cuts have already had on our military readiness. America is becoming less capable of projecting power and deterring conflict wherever it arises. For example, despite almost daily evidence of the increasing threat to the United States posed by rogue states with ballistic missiles, the President’s budget cuts spending on missile defense.

“A solid budget proposal – like the one House Republicans submitted last month – would develop American energy projects like the Keystone XL pipeline, fundamentally reform the tax code, eliminate job-crushing regulations, cut wasteful spending, and ensure we have the military needed to keep Americans safe. We need to enact policy that allows for income mobility and empowers economic opportunity. The Obama budget fails to do all of this. On the bright side, after arriving 65 days late, the budget proposal is useless considering the House and Senate have already proposed and passed budget resolutions.”

The Heritage Foundation analyzed President Obama’s budget and published “Five key things to know about President Obama’s budget“:

1. It hikes taxes by $1.1 trillion.

Heritage’s Curtis Dubay says: “There was little doubt that President Obama would propose a huge tax hike in his budget. It is a bit surprising, however, that the total tax increase he proposes is almost double what he claims it to be.”

Dubay explains where all the tax increases come from—including the “Buffett Rule,” capping tax deductions, and hiking the cigarette tax and the death tax.

BudgetGuide_Snippet_V2

See an extended version of this infographic

2. It underfunds defense.

Heritage’s Patrick Louis Knudsen explains that “While boosting domestic spending, the President remains indifferent to national security needs. His proposed defense spending, though somewhat higher than sequestration levels, remains inadequate.” Baker Spring says, “The result is going to be a defense posture that is too small in terms of both personnel and force structure, does not include modern weapons and equipment, and does not provide adequate levels of training and maintenance.”

3. It doubles down on Obamacare.

The Obama budget actually expands parts of Obamacare and even includes new changes to Medicare that create two sneaky new “taxes” on seniors. Obamacare’s “malignant new entitlements—its health insurance subsidies and Medicaid expansions—start in this 2014 budget,” Knudsen reminds us.

With their implementation, the misnamed Affordable Care Act will add a distinctly unaffordable $1.8 trillion in federal spendingthrough 2023. Equally important, Obamacare commandeers the health care sector with a massive program that further distorts the market, intrudes on the doctor-patient relationship, and dismisses personal and religious liberty.

4. It doesn’t balance and never will.

As Knudsen says, “Because the budget never balances—it doesn’t even try—debt remains at dangerously elevated levels.” See how Obama’s non-balancing budget compares to the plansin the House and Senate, as well as Heritage’s Saving the American Dream plan.

5. It’s irrelevant.

The President’s budget is more than two months late. The House and Senate have already passed their own budgets, and the next step is for the two chambers to come together to see if they can hash out a budget that both chambers can pass. At this point, why is the President bothering?

Rubio introduces “Refund Act” to empower states to help pay down the national debt

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U.S. Senator Marco Rubio today introduced the Returned Exclusively For Unpaid National Debt (REFUND) Act. This legislation would allow states to identify and return unwanted federal funds to the federal treasury in order to help pay down the $16.7 trillion national debt. The REFUND Act has 16 original cosponsors in the Senate and a companion bill, H.R.282, has already been introduced in the U.S. House of Representatives by Representative Chuck Fleischmann (TN-3).

“Excessive spending is fueling our growing debt, yet states have little say in what happens to federal money if they choose not to spend it,” said Rubio. “The REFUND ACT can help end the ‘use-it-or-lose-it’ mentality which encourages states to take debt-financed money from Washington. Instead it will empower them with a way to help slow the steady rise of the national debt.”

“Many state officials and leaders realize the national debt is an increasing burden to our children and grandchildren and want to help stop Washington’s spending spree to help alleviate that burden. The REFUND Act will give states an opportunity to end the practice of spending money we don’t have and serve as an incentive for them to help pay down the debt and re-embark on a path toward economic growth and opportunity.”

The REFUND Act would allow any state to designate federal funds as “unwanted” through a resolution from the state legislature, which would then be allocated towards debt reduction at the Treasury Department. The REFUND Act would require that an annual report be submitted to Congress each year detailing the amount deposited by each state. The REFUND Act has been endorsed by the Council for Citizens Against Government Waste (CAGW) and the National Taxpayers Union (NTU).

Original cosponsors of the REFUND Act are Senators Lamar Alexander (R-TN), John Barrasso (R-WY), Roy Blunt (R-MO), Saxby Chambliss, (R-GA), Dan Coats (R-IN), Tom Coburn (R-OK), John Cornyn (R-TX), Mike Enzi (R-WY), Jim Inhofe (R-OK), Johnny Isakson (R-GA), Mike Johanns (R-NE), Ron Johnson (R-WI), Mitch McConnell (R-KY), Rand Paul (R-KY), Jim Risch (R-ID) and David Vitter (R-LA).

The question is will the states put the best interests of the American people first? Or will they keep the money.

Many times state political leaders argue that if we don’t take the money it will go to another state. Now, that excuse could become invalid. Let’s see if this gets passed in a divided Washington, where two thirds of the politicians want more taxes and more spending.

Taxes in Florida Explained

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April is National Tax Burden Month. WDW – Florida is providing information on taxes in Florida. The following information is from the Florida portal on taxation:

For decades, Florida has had one of the lowest tax burdens in the country, according to the independent research organization Tax Foundation. For 2013, Florida will place the fifth-lowest tax burden on its residents and businesses. But not all taxes are created equal, and the state collects in a variety of ways that residents need to be aware of.

Income Tax

The strength of Florida’s low tax burden comes from its lack of an income tax, making them one of seven such states in the U.S. The state constitution prohibits such a tax, though Floridians still have to pay federal income taxes.

Estate Tax

Florida also does not assess an estate tax, or an inheritance tax. No portion of what is willed to an individual goes to the state.

Intangibles Tax

Floridians no longer need to pay taxes to the state on intangible goods, such as investments. The law requiring that tax was repealed in 2007.

Sales Tax

The state charges a 6% tax rate on the sale or rental of goods, with some exceptions such as groceries and medicine. Additionally, counties are able to levy local taxes on top of the state amount, and most do—55 of the 67 Florida counties added local sales tax to the state tax in 2012. The highest amount added to the sales tax was 1.5% by 7 counties in 2012, bringing the total sales tax to 7.5% in those counties; that will increase to 8 counties in 2013. For a complete list of the additional sales tax rates by county, visit the Florida Department of Revenue: http://dor.myflorida.com/dor/forms/2013/dr15dss.pdf

Use Tax

State sales tax needs to be paid for internet or other out-of-state purchases, even if no tax was charged at the time of purchase, or were charged at a rate less than the Florida sales and use tax rate. While this includes taxable items bought in Florida, it mostly applies to items bough outside of the state which were brought in or delivered. Florida residents are required to report these sales and pay the use tax on them personally.

Property Tax

Though the state government does not collect any property taxes, local governments receive much of their funding through these taxes. These rates are assessed at the local level and can vary by county, and they are based on the value of the property. Property taxes in Florida are some of the highest in the country, although there are several exemptions to try to lighten the load on some Floridians.

Property Tax Exemptions

Homestead Exemptions are available on primary residences in Florida. These exemptions can be available up to $50,000. However, only the first $25,000 of this exemption applies to all taxes. The remaining $25,000 only applies to non-school taxes.

Widow(er) Exemptions of $500 are available to widows and widowers who have not remarried. If you were divorced at the time of your ex-spouse’s death, you do not qualify for this exemption.

Senior Citizen Exemptions are available in http://dor.myflorida.com/dor/property/taxpayers/pdf/FLsrhx.pdfcertain counties and cities only. They are valued up to $50,000 for residents 65 years old and older who have gross income below $20,000 in 2001 dollars, adjusted for inflation. This exemption is in addition to the Homestead Exemption.

Blind Person Exemptions of $500 are available to Floridians who are legally blind.

Total and Permanent Disability Exemptions are available for homeowners who have a total and permanent disability. Quadriplegics who use their property as a homestead are exempt from all property taxes. Others who must use a wheelchair for mobility or are legally blind and have a gross income below $14,500 in 1991 dollars, adjusted for inflation, can be exempt from all property taxes as well.

Veterans Exemptions exist in a number of different forms.

  • A veteran documented as disabled by 10% or more in war or service-connected events can earn an additional exemption of $5,000 on any owned property.
  • An honorably discharged veteran who is totally and permanently disabled or requires a wheelchair for mobility due to their service can be exempt from all property taxes. In some circumstances, this benefit can be transferred to a surviving spouse.
  • An honorably discharged and disabled veteran who is 65 or older who was a Florida resident when they entered military service may be eligible for an additional exemption. The disability must be permanent and must have been acquired as a result of the military service. The property tax will be discounted based on the percent of the disability.
  • Members of the military deployed during the last calendar year can receive exemptions based on the percent of time during the year they were deployed.

Other Taxes

Florida collects taxes on many other goods and services residents pay for. Documentary Stamp Taxes are assessed on documents that transfer interest in Florida real property, such as warranty deeds and quit claim deeds. Additional taxes are charged for fuels, tobacco products, communications services, and more. For a full of account of taxes charged in Florida, see the website.

Corporate Income Tax

While individuals do not have to pay income taxes, the same is not true for all types of businesses in Florida. Corporations and artificial entities that conduct business, or earn or receive income in Florida, including out-of-state corporations, must file a Florida corporate income tax return unless exempt. They must file a return even if no tax is due. Sole proprietorships, individuals, estates of decedents, and testamentary trusts are exempted and do not have to file a return. S Corporations are usually exempt as well, unless federal income tax is owed. The Florida Corporate Income Tax rate is 5.5%.

For more information about the types of businesses in Florida, click here.

Reemployment Tax (formerly Unemployment Tax)

Eligible businesses must also pay the Reemployment Tax. Formerly called the Unemployment Tax before being renamed in 2012, this tax is used to give partial, temporary income to workers who lose their jobs through no fault of their own, and who are able and available to work.

 

Illegal aliens receive $Billions Yearly via IRS Loophole

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As part of National Tax Burden Month WDW –  Florida presents this column with videos of well known and documented tax fraud.

NBC Eyewitness News 13 in Indiana reports on a massive IRS tax loophole which provides over $4 billion per year in tax credits to millions of illegal aliens. In many cases recipients of American taxpayers’ misused monies have never set foot in the United States.

Watch this exposé put together by News 13 investigative reporter Bob Segall. He spent three months looking into this tax loophole:

Indiana is approximately 1700 miles northeast of the Mexican border.

A device known as the Additional Child Tax Credit is being used to pay for children living in Mexico — who have never lived here. One illegal admitted through an interpreter that his address is being used to file tax returns for numerous children, including multiple nieces and nephews. “If the opportunity is there and they give it [to him] why not take advantage of it?” he asked in Spanish. As a stunning example, thousands in tax credits have been awarded to an illegal alien who claimed 20 children live in a single trailer, that actually housed just one little girl.

“Our tax code should not reward those who enter the country illegally,” said Rep. Vern Buchanan (FL-13). “This is unacceptable, which is why last year I voted to immediately end the abuse of the Child Tax Credit by requiring those filing a claim to provide a Social Security number – a requirement that would save taxpayers $10 billion over the next decade.”

The IRS is aware of the magnitude of this fraud yet has done nothing to rectify it. In fact, this is the IRS website giving ten tips on how to apply. The application forms are easily downloadable.

J. Russell George, Treasury Inspector General for Tax Administration says report after report sent from his office has been ignored by the IRS. 

Watch the below video as the Honorable J. Russell George, Inspector General, Treasury Inspector General for Tax Administration, delivers his opening statement at an oversight hearing on Administration of the First-Time Homebuyer Tax Credit. October 22, 2009.

Rubio: States need a refund

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Congress should authorize them to return federal spending to pay down the debt.

While American families everywhere are cutting costs, Washington still can’t seem to rein in its reckless spending, leaving our national debt skyrocketing to the detriment of future generations. This neglect of our fiscal health is unacceptable. It is imperative we begin paying down the debt — starting yesterday.

Excessive and ineffective spending is an important cause of our growing debt, yet states have little say in what happens to federal money if they choose not to spend it. They essentially have two choices: use it, or lose it to someone else. There is no option to stop those funds from being spent elsewhere, which is why I am reintroducing the Returned Exclusively for Unpaid National Debt, or “REFUND,” Act next week in the Senate.

The REFUND Act will allow states to identify and return unwanted federal funds to the federal treasury for the specific purpose of paying down the national debt. This prevents the Treasury from continuing its current practice of spending the returned funds elsewhere, which provides no real incentive for states to turn away federal funds.

The legislation would also end today’s “use it or lose it” mentality, which encourages states to take debt-financed money from Washington. For example, two years ago, the state of Florida was allocated $2.4 billion in federal stimulus funds for a high-speed-railway project, but turned down the money because it would have put the state on the hook for more spending in the long run. The money was then offered under a new bidding process for other states to fund their own high-speed-rail programs. Under the REFUND Act, Florida would have been able to use that money toward paying down our $16 trillion debt.

The national debt is a crushing burden to our children and grandchildren; many state officials and leaders realize this and want to make responsible decisions to help alleviate that burden. These fiscally responsible states should be allowed to divert Washington’s spending spree toward debt reduction and do their part to end the practice of spending money we don’t have.

Read more at National Review Online.

Exposing Tax Filing Costs

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As part of National Taxpayer Burden Month, Watchdog Wire is presenting a series of interviews, columns and videos dealing with the current progressive income tax system. The current income tax was created 100 years ago with the passage of the Sixteen Amendment to the US Constitution.

As part of our National Tax Burden Month activities we are highlighting a series of videos produced by Kerry Bowers, the State Director for Nevada FairTax. For 13 years Bowers lived in Florida, the last 4 as the Panhandle Director for the Florida FairTax Educational Association.

According to the Fair Tax website:

The FairTax is a national sales tax that treats every person equally and allows American businesses to thrive, while generating the same tax revenue as the current four-million-word-plus word tax code. Under the FairTax, every person living in the United States pays a sales tax on purchases of new goods and services, excluding necessities due to the prebate. The FairTax rate after necessities is 23% and equal to the lowest current income tax bracket (15%) combined with employee payroll taxes (7.65%), both of which will be eliminated.

Bowers support to FFTEA and AFFT has been through legislative expertise specific to HR 25/S 122, computer presentations, and video productions. The following is a video presentation exposing the true tax filing costs born by every taxpayer.

To video more video presentations by Kerry Bowers go to his YouTube Channel.

RELATED COLUMNS:

When is your tax freedom day?

VIDEO: Buchanan Tax Reform panel raises disturbing future without major changes

Disclaimer: The author is on the Board of Directors of the Florida FairTax Educational Association

VIDEO: Buchanan Tax Reform panel raises disturbing future without major changes

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Congressman Vern Buchanan (FL-13) hosted a panel on Tax Reform on March 29, 2013. Buchanan is the only member of the powerful US House of Representatives Ways and Means Committee from Florida. The panel members were:

  • Neal Boortz is a former nationally syndicated radio talk show host who co-wrote the Fair Tax Book with former Congressman John Linder. The book calls for the replacement of the income tax with a consumption tax.
  • Dan Mitchell is a senior fellow with the Cato Institute, which is a public policy research organization dedicated to the principals of individual liberty, limited government, free markets, and peace. Mitchell is an expert on tax reform and a strong advocate of a flat tax.
  • National Federation of Independent Business (NFIB)/Florida Chairman Jerry Pierce. The NFIB is is the leading small business association representing small and independent businesses. The NFIB supports modifications to provide tax relief and certainty to small businesses.
  • Susan Nilon is the general manager of WSRQ radio, a radio show host and writer who advocates a progressive tax that taxes wealthy individuals at a higher rate than low income individuals.

The forum was moderated by WWSB/ABC 7 news anchor John McQuiston.

Watch the METV video of the entire panel discussion:

Every panel member opened by saying the current income tax system is broken. Susan Nilon asked if there was the political will to actually fix it. Each panel member addressed their solution to fix the system, ranging from repeal of the Sixteenth Amendment (which created the progressive income tax) to returning to a simpler form of taxation.

Of note was all agreed the current progressive tax system has failed. Boortz pointed out that progressive taxation was first outlined in the Communist Manifesto. Boortz, speaking for the Fair Tax, said that repeal was the best solution long term. Both CATO’s Dan Mitchell and NFIB’s Jerry Pierce agreed. Pierce noted that this was not the official NFIB position but his alone.

John McQuiston, the moderator, asked if changing the current system in any meaningful was was politically possible. Mitchell noted that during the 1990s Congress passed meaningful welfare reform and likened the tax reform challenge as doable. Congressman Buchanan indicated that from his meetings with President Obama and others that there is a six month window of opportunity to make meaningful changes.

The Fair Tax was most discussed by panel members. Mitchell noted that even though he was on the panel to represent the flat tax he had debated in favor of the Fair Tax. Nolan was concerned that the low income taxpayers would be negatively impacted. Boortz pointed out that under the Fair Tax, those making minimum wage would see a negative 23% tax while those making $31,000 would have a zero tax bill.

The issue of tax loop holes for corporations came up  repeatedly. Corporations like GE have lobbyists who are paid to insure they pay no taxes and these lobbyists have been successful. Boortz pointed out that corporations pay no taxes. Rather individual stockholders and the consumers bear the burden of the taxes levied on the products and services provided by corporations.

The question of charitable deductions came up. Mitchell pointed out that all academic studies of charitable giving show that two things drive individuals to give – wealth and disposable income. For example the bill signed by President Obama in January limits itemized deductions for those making over $450,000 to 3%. The closing of loopholes already includes limiting deductions for high wealth individuals.

During the presentation the audience showed its appreciation for the panel and Rep. Buchanan by their applause. Boortz pointed out this type of event is critical if tax reform is to take place. Without the power of the people nothing will happen. Boortz pointed out that with the implementation of the Fair Tax and elimination of the progressive income tax, “it will be the greatest transfer of power from government to the people since the American revolution.”

At the end of the discussion both Rep. Buchanan and Jerry Pierce warned that the United States faces a financial meltdown in the next 3 to 8 years. Mitchell noted that by 2040 Greece spending will be at 300% of their GDP, while America’s spending will be at 450% of GDP. The disaster is eminent noted Rep. Buchanan but he believe a bi-partisan agreement is possible within the next six months.

If none is reached then America’s fiscal downfall is set. The question is not if, but when.

Rep. Vern Buchanan to Hold Forum on Tax Reform

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Sarasota, Florida – U.S. Representative Vern Buchanan announced today that he will host a forum on tax reform. Buchanan is Florida’s only member of the powerful U.S. House Ways and Means Committee, which is reviewing current federal income tax law and chairman of the small business working group.

“The current tax code punishes everyone from families to employers trying to compete in the global marketplace,” said Buchanan. “I am working in Congress to fix our broken tax code. My goal is a simpler, fairer, pro-growth tax code that helps get Americans back to work.”

Buchanan noted that various proposals have been put forth for tax reform in the United States, including a flat tax, a sales tax or keeping the present code with some simplification or modification in the tax structure.

The panel for the forum includes:

  • Neal Boortz is a former nationally syndicated radio talk show host who co-wrote the Fair Tax Book with former Congressman John Linder. The book calls for the replacement of the income tax with a consumption tax.
  • Dan Mitchell is a senior fellow with the Cato Institute, which is a public policy research organization dedicated to the principals of individual liberty, limited government, free markets, and peace. Mitchell is an expert on tax reform and a strong advocate of a flat tax.
  • National Federation of Independent Business (NFIB)/Florida Chairman Jerry Pierce. The NFIB is is the leading small business association representing small and independent businesses. The NFIB supports modifications to provide tax relief and certainty to small businesses.
  • Susan Nilon is the general manager of WSRQ radio, a radio show host and writer who advocates a progressive tax that taxes wealthy individuals at a higher rate than low income individuals.

The forum will be moderated by WWSB/ABC 7 news anchor John McQuiston.

The event will be held at 11:00 a.m. on Friday, March 29, 2013 at New College of Florida’s Mildred Sainer Pavilion, 5313 Bay Shore Rd, Sarasota, FL 34243.

The event is free and open to the public. Please call 941.951.6643 or click here to RSVP.

Sinkholes: Florida taxpayers’ looming financial disaster

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Sinkholes have been in the news recently when Mr. Jeff Bush went missing after his bedroom was swallowed up. Efforts to find Mr. Bush have been stopped.

See the  map below to understand the extent of the Florida sinkhole problem:

Click on map for a larger image.

The tragedy of Mr. Bush is overshadowed by the potential costs of paying sinkhole claims by Citizens Insurance Corp. 

According to the September 2012 Citizens Property Insurance Corporation rate hearing, “Citizens lost nearly $1 billion on sinkhole losses occurring in 2007-2011 with a loss ratio for sinkhole business for 2011 of 877%. This created net loss for the PLA for year ended 12/31/11 and resulted in less financial resources to pay for future hurricanes.”

Unlike private carriers Citizens is not able to manage risk and reduce policy counts to manage such risk. As an insurer of last resort, created by Florida statute, Citizens must write most risks that apply for coverage.

Florida property owners received their property insurance bills and found the line item “FL HURRICANE CAT FUND PREMIUM RECOUPMENT”.

When Watchdog Wire asked Citizen Insurance: Is this recoupment a tax increase on all homeowners? The reply was, “Yes, all Floridians assume the potential for assessments should Citizens run into a deficit situation.”

This “recoupment” is a tax on every Florida property owner.

According to Citizens Insurance, ”Citizens may levy an Emergency Assessment when Citizens incurs a deficit in any year and that deficit exceeds the amount to be collected by the Regular Assessment.” See Florida Statue 627.351(6).

Florida taxpayers may be the next sinkhole victims – a sinkhole called Citizen Insurance.

Florida House rejects Obamacare Medicaid expansion

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John Hayward from Human Events reports:

On the eve of convening of the 2013 session, the House Select Committee on the Patient Protection and Affordable Care Act rejected the expansion. A Senate counterpart committee postponed consideration of the issue, which is sure to be one of the biggest controversies of the session.

Scott, a Republican who bitterly fought President Barack Obama’s national healthcare plan as a candidate and in his first two years as governor, stunned conservative supporters on February 20 when he endorsed a three-year expansion of Medicaid, provided the federal government picks up the full cost for the first three years as promised.

“There’s definitely a fight between the governor and the (state) legislature over this. The Republicans in the legislature are much more fiscally conservative than his actions have shown him to be,” said Susan MacManus, a Tampa-based political scientist at the University of South Florida.

Republican legislative leaders have been openly hostile toward the plan, emphasizing that state lawmakers will make the final decision in drawing up a budget for next fiscal year.

The Florida based James Madison institute released the following statement:

The House made the right decision today to not draft a committee bill expanding Medicaid under PPACA provisions. Many Members expressed valid concerns that this could hurt the people that it is aimed at helping. State leaders should focus on providing more access to quality care — expanding a program that is inefficient in this effort is not a way to do that.

Additionally, in our recent poll of 600 registered Florida voters more than 63 percent said they are wary that the federal government would keep the funding level promises made, and clearly many House Members share this worry. If history is any indicator, costs of such programs are often underestimated and there has been examples of the federal government going back on their promise before. These issues cannot be ignored.