Bottled Water Tax is Back
Despite Senate President Jeff Atwater’s pledge that the chamber will not increase taxes on Floridians, the Senate Commerce Committee raced ahead Wednesday and approved a new, 6 percent tax on bottled water.
The move – likely short-lived – resurrected an effort that convulsed lawmakers last year after Gov. Charlie Crist proposed making Florida the first state in the nation to charge bottlers with a severance tax for pulling water from state springs.
Crist has abandoned that proposal – which drew fierce opposition from big water companies that profit from the 3.6 million gallons of water state officials say are drawn daily. But Sen. Evelyn Lynn, R-Ormond Beach, gained strong support from the Commerce Committee, which voted 7-1 to approve a 6 cents state tax on every bottle of water bought in Florida – a move that could pull $42.3 million into Florida’s recession-ravaged treasury.
“This is not a tax,” Lynn said. “It’s a surcharge to save the environment.”
But Martha Harbin, lobbyist for the Florida Beverage Association, which includes many of the state’s water bottlers, disagreed, saying the industry’s empty plastic bottles are not the pollution threat Lynn made them out to be.
“We just feel this is a punitive tax based on bad science,” Harbin told the committee.
While Crist’s severance plan would have hit the industry directly, the bottle tax is aimed more at consumers. Also working against the legislation may be that Nestle Waters of North America, the industry giant in Florida, bottles water and is a big employer in Madison and Zephyrhills, in the home district of designated future House Speaker Will Weatherford, R-Wesley Chapel.
The Commerce Committee was more generous in doling out tax breaks, approving a half-dozen proposals advanced by Senate Finance and Tax Chairman Thad Altman, R-Viera, that are aimed at helping his home-region Space Coast deal with an anticipated loss of 9,000 jobs in October stemming from the federal government’s shutdown of NASA’s Space Shuttle and Constellation programs.
The lost aerospace jobs are expected to be compounded by other losses in the region’s service economy to send unemployment in Brevard County soaring to 17 percent, according to state workforce officials. Altman’s proposals include tax credits designed to attract the commercial space industry and requirements that 20 percent of the state’s Quick Action Closing Fund go toward promoting a diversified aerospace industry.
The price-tag on Altman’s proposals hovers near the $32 million, the amount Gov. Charlie Crist has recommended toward helping maintain jobs in the region.
But hitting a roadblock in the committee was Sen. Don Gaetz’s effort (SB 2436) toward clarifying the tax liability of Internet travel companies booking rooms in Florida.
Gaetz is looking to have lawmakers declare that tourist development taxes and other hotel levies are owed only on the retail price of hotel rooms – not the marked-up price charged when the reservation is made by such companies as Expedia and Travelocity when their service fees are included.
Attorney General Bill McCollum sued Expedia and Orbitz last fall claiming they owed the state millions of dollars in back taxes over the disputed billing practices, even as he acknowledged state law was vague. Gaetz, who said he now has McCollum’s support, would apparently settle the clash – by siding mostly with the Internet companies.
The measure includes a provision that strengthens counties’ ability to receive a share of Revenue Department cases that result in the collection of taxes owed by noncompliant taxpayers – softening opposition from many of the half-dozen counties that have also filed suit seeking higher payments from the Internet bookers.
Orange and Brevard counties, however, opposed Gaetz’s bill – with lobbyist Jim Zingale telling the committee the move is seen as an “erosion of the tax base.” But divisions within the Senate over which way to lean on the measure became evident when an attempt to amend Gaetz’ bill failed on a 4-4 tie vote – and the senator asked to postpone action on the bill.