New Florida Law Limits Property Tax Increases

Florida approved a key change in its fiscal policy. Governor Ron DeSantis signed a law that limits increases in property tax, one of the main sources of revenue for local governments. The measure comes in a context of strong revenue growth. In just six years, income from this tax grew from approximately $30 billion in 2019 to nearly $60 billion today. The increase has generated concern among taxpayers and state authorities. The new legislation seeks to halt that trend and establish stricter controls over how the tax burden is set.

Changes to the Tax Formula

Senate Bill 4-F (SB 4-F) introduces modifications in how local governments determine the property tax rate. Until now, they could adjust it based on per capita personal income. The new rule eliminates that mechanism. Instead, it sets the so-called rollback rate as the general limit, designed to keep total tax collection stable compared to the previous year. This means that even if property values rise, governments will not be able to automatically increase their tax revenues. The goal is to avoid indirect increases in the burden for property owners. To exceed that limit, local authorities must meet stricter requirements. In most cases, a two-thirds majority in governing bodies will be needed.

Greater Transparency in Public Spending

Along with the tax reform, DeSantis enacted the Local Government Financial Transparency and Accountability Act (HB 1329). This law will take effect on January 1, 2027. The goal is to provide greater clarity on the use of public resources. Local governments will be required to publish detailed information that was not previously systematized. New requirements include quarterly expense reports, employee compensation data, and budget calendars. They must also ensure that information is accessible to the public. Additionally, each administration must conduct a 10% reduction exercise of the proposed spending before approving its annual budget. This adjustment cannot affect essential services.

The State Government’s Argument

During the signing in Bradenton, DeSantis defended the measure as a way to protect taxpayers. According to his position, the current system allows hidden tax increases. The governor explained that when a property’s value rises, the owner pays more, even though the rate does not change. He considers this to generate an unfair burden for citizens. He also linked the law to a future constitutional amendment. The proposal, which will be voted on in November 2026, seeks to expand tax benefits for primary homeowners. SB 4-F acts as an implementation rule for that initiative. It even contemplates expanding the information available on ballots to better explain the measure to voters.

Impact on Municipalities and Public Services

The change generates concern in some political sectors and local authorities. The main criticism points to the possible reduction in revenues without a clear alternative source. Democratic leader Fentrice Driskell warned that even small cuts could have significant effects. She pointed out that there is no plan to compensate local governments. Municipalities rely heavily on property taxes. These resources fund services such as public safety, infrastructure, parks, and libraries. A drop in tax collection could force cuts or require seeking new sources of income. This scenario creates uncertainty about the real impact of the law in the medium term.

Divided Positions and Ongoing Debate

Bradenton Mayor Gene Brown adopted a more balanced position. He acknowledged the need to ease the tax burden, but also the difficulty of maintaining services with fewer resources. Brown pointed out that local governments face constant tension. They must find ways to return money to taxpayers without compromising the city’s basic functioning.