Negron, Gaetz: Cut Vehicle Registration Fees

March 24, 2013

Eliminating a quarter century-old tax credit for the insurance industry could allow the state to reduce the annual vehicle registration fees that were raised during the heart of the Great Recession, Sen. Joe Negron, R-Stuart, chairman of the Appropriations Committee proposed.

Negron, who intends to formally present his proposal as a committee bill, predicted that by eliminating the tax credit established in 1987, motorists overall could see up to $220 million a year in savings if the 2009 vehicle registration fee increase was cut in half.

When the economy tanked at the end of 2008, lawmakers the next year, desperately seeking revenue but unwilling to raise taxes, made a controversial decision to raise fees on drivers instead. Opponents said it was regressive – hurting poor people as much or more than the wealthy.

The move, as lawmakers were facing a $6 billion shortfall, increased vehicle registration fees by 35 percent, as the cost of renewals, titles and driver licenses all were boosted.

“We were all elected, and we should make decisions that reflect our priorities today,” Negron said during the committee meeting on Thursday.

Senate President Don Gaetz, R-Niceville, quickly sent out a release supporting Negron’s proposal.

“In 2009, during a difficult budget year, the Legislature made the hard choice to increase certain fees associated with driving a vehicle in lieu of raising taxes, or taking draconian cuts to critical state services,” Gaetz said. “However, times have changed and it is time that we reprioritize and evaluate ways to keep more money in the pockets of hard working Floridians.”

The insurance industry tax credit was designed to offset the Insurance Premium Tax.

But Negron noted that only one other state, Arkansas, offers a similar discount that has allowed insurance companies to get rebates of 15 percent of the salaries of their employees in Florida.

House Speaker Will Weatherford, R-Wesley Chapel, expressed interest in the proposal after the House session on Thursday, but said he’ll have his budget chairs review the plan.

“It’s an interesting idea,” Weatherford said. “I’m not a fan of those taxes either.”

House Minority Leader Rep. Perry Thurston, D-Fort Lauderdale, intends to approach the proposal with caution.

“We would think that it would be a good idea to bring down the costs to everyday Americans who have to drive because in Florida we don’t have mass transit,” Thurston said.

“But we’re concerned about those type of proposals, because when you’re given incentives we want to know who is getting the benefit of those incentives?” he added. “Is it for working Floridians or are we just giving a handout to a big company without them having to be accountable, which we wouldn’t support.”

By The News Service of Florida

Comments

3 Responses to “Negron, Gaetz: Cut Vehicle Registration Fees”

  1. Michael Murph on March 25th, 2013 3:48 pm

    “In 2009, during a difficult budget year, the Legislature made the hard choice to increase certain fees associated with driving a vehicle in lieu of raising taxes….”

    Funny, but my checking account doesn’t differentiate between taxes and fees. They both lower my balance.

  2. Mrs.B on March 25th, 2013 11:47 am

    I hope they do cut the registration fees. I was a resident of Florida and I moved to Alabama and I am now back in Florida. I was shocked when I went to get everything changed over to Florida. It amazed me that Alabama only charged $26.00 for me to get my license changed and Florida charged me $152.00. Do not even get me started on the price of my tag and title. I hope they do cut down the taxes on everything.

  3. Waterlady501 on March 24th, 2013 7:19 am

    Just for the record, fees associated with driving were not the only fees/taxes raised in the “difficult budget year of 2009″. Our local water system must pay a license fee each year to Florida Department of Environmental Protection, just to operate. This fee is in addition to all the other regulatory requirements we must meet for that agency. Up until 2009, that fee was $50.00 per year. When the new budget was passed in 2009, along with many other increases, it approved an increase for this license to $2,000.00. That’s right: from $50.00 to $2,000.00 with the stroke of a pen.

Written by William Reynolds · Filed Under News