Florida Lawmaker Proposes Eliminating Property Taxes with New Revenue Model

Florida is considering significant changes to its property tax system, with state Rep. Ryan Chamberlin proposing a controversial plan to eliminate property taxes entirely. His proposal, known as "Freedom 1,2,3," aims to roll back property tax rates to 2023 levels while introducing alternative revenue streams. Key components include a 5% transaction fee on real estate sales, another 5% sales tax on travel-related transactions such as hotels and rideshare services, and a three-cent sales tax dedicated specifically to school districts.

The plan anticipates generating substantial revenue: $43 billion from property tax rollbacks, approximately $20 billion from the sales tax earmarked for education, and additional funds from other transaction fees. The idea is to shift the tax burden from ongoing property taxes to one-time or usage-based fees, restructuring revenue collection in the state.

Chamberlin's proposal faces scrutiny and is part of ongoing discussions among a 37-member special committee focused on property tax reform. While Chamberlin leads this initiative independently of Governor Ron DeSantis and the committee's co-chair, state Rep. Toby Overdorf, it joins a broader debate including alternatives such as enhanced homestead exemptions.

Stakeholders are concerned with how essential services and school funding will be maintained under such a revenue model. Chamberlin emphasizes that the three-cent school tax would be strictly allocated to education, addressing some concerns over fiscal responsibility.

This proposal represents a major shift in Florida's taxation approach, reflecting growing interest in reforming property taxes for homeowners and investors. The upcoming committee meetings will provide a clearer outlook on the feasibility of these reforms and potential compromises or alternative strategies.

The market impact involves potential changes to real estate transaction costs and consumer behavior related to property purchases and travel expenditures. Insurance professionals should monitor this evolving regulatory landscape as it may influence risk assessments, property values, and infrastructure funding in Florida.