Hurricane Exemptions Successful; Sponsors Plan Its Expansion in 2006

June 14, 2005

Although Florida’s sales tax exemptions on hurricane supplies ended Sunday, with no guarantees of reoccurring next year, the event was so popular that several legislators responsible for the event are pledging to increase the number of tax-exempt items in 2006 to include plywood and hurricane shutters.

Florida retailers, including Lowe’s Home Improvement Warehouse and Home Depot, reported record sales during the tax holiday. Lowe’s spokeswoman Jennifer Smith said it sold more than 28,000 generators.

Dave Bruns, a spokesman for the state Department of Revenue, which administers the state’s sales tax, said the agency won’t receive sales tax data from June until at least mid-July. He said the agency will bring some consumer complaints about the tax holiday to legislators’ attention next year. Some of the issues raised by consumers include a shortage of portable generators at hardware stores and why shutters and plywood weren’t on the tax-exempt list.

State Sens. Walter “Skip” Campbell Jr., D-Tamarac, and Carey Baker, R-Eustis, who co- sponsored the Senate bill that created the holiday, told the Tampa Tribune that so many people took advantage of the tax exemption that they expect the Legislature to quickly pass it again next year.

Baker said he would have preferred more items on the tax-exempt list this year. However, there was some debate about how much the tax holiday would cost the state and local governments in lost tax revenue. So legislators tried to limit the financial hit the government would take by limiting the list of items. This year’s tax holiday is expected to cost the state and local governments about $10 million in lost sales taxes.

Campbell said legislators had to leave plywood off the tax-exempt list this year because of the fear that building contractors might buy up loads of plywood for new construction, rather than for hurricane preparations. Placing a cap on how much plywood a single person could buy tax- free would prevent such abuse, but this year retailers were unable to come up with a good system for implementing a cap, Campbell said.

Next year, Campbell hopes plywood will be added to the tax-exempt list, along with other items such as extension cords and hurricane shutters, both installed by professionals and by do-it-yourselfers.

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