Other Views from Those in the Know
President and CEO
Insurance Industry Still Needs Its 30-year-old Tax Break
The relentless focus Gov. Rick Scott and the Florida Legislature have placed on rebuilding Florida’s economy and growing its workforce in recent years has yielded unheralded success. Notably, the state’s unemployment rate is now lower than it has been in more than four years and lower than the national average.
Throughout this legislative session, our leaders have continued discussing creative and innovative measures that will perpetuate this success and make Florida a more attractive place to do business when compared to competing states. However, one recently unveiled Senate proposal undermines the effectiveness of those efforts and poses a significant step backward and could be a detriment of our state’s financial health.
The proposal removes a 30-year-old tax credit on insurance companies’ payroll, an industry that employs more than 180,000 Floridians across the state. The 15 percent performance-driven tax credit, implemented in 1987, was meant to incentivize these employers to hire more Floridians and pay them a good wage, and it has worked every day since its enactment. More tlhan 44,000 jobs were added in the last three years, demonstrating that these credits continue to work to create jobs for real Floridians.
The state is contemplating removing that credit and using the resulting revenue to offset the high auto-tag and -license fees that have burdened Floridians for the last few years. While this may be a meritorious objective, we respectfully disagree that transferring that tax burden onto large Florida employers has no impact on their ability to maintain and increase their workforce.
Further, this proposal sends a bad message to any and all companies looking to relocate to the Sunshine State, whether their industry is insurance, manufacturing, medical, biotech or whatever. Businesses need predictability and stability to advance their companies and increase their payrolls.Companies looking to make a move to another state need that level of certainty even more. With the possibility of these tax credits going away, or the domino effect this move could have on the many other tax incentives programs currently in place in Florida, we are putting the future of all business growth in Florida at risk.
We all know that employers are the backbone of a healthy economy, and we also know that transferring one tax burden to another is not reducing taxes; it is simply forcing one payer to cover the costs of another.
It has been said, that government does not create jobs but that if it fosters a business-friendly environment, the private sector will create jobs and put Floridians to work. If this is truly the principle that guides our leaders to create economic prosperity for our state, then we urge lawmakers to reconsider this proposal and the impact it will have on employers and businesses all across Florida.
Tom Feeney is president and CEO of Associated Industries of Florida, which aims at fostering an economic climate in Florida conducive to industry growth.
© Florida Voices
Published Sunday, April 07, 2013