Taxing Times

A battle is brewing at the Florida Capitol over whether the state should give away millions in tax cuts this year or put more money into schools, roads and other services. Educators think the answer is obvious.

David Worrell has been an art teacher for almost 30 years. He’s frustrated that Jeb Bush wants to give back more than $270 million in tax cuts this year while schools are struggling to keep up with enrollment.

David says, “Further tax cuts over the next few years don’t seem to be what’s in order right now. If anything, education needs twice the funding that it’s being budgeted for.”

The governor wants to phase out taxes on investments for wealthy Floridians. There’s also talk of tax breaks on back-to-school shopping, gasoline, even hurricane supplies. Florida is flush with cash right now, but a billion dollar budget gap is looming in a few years, and some members of the governor’s own party are worried.

Sen. Tom Lee, (R) Florida Senate President, says, “Before we continue to do more tax cuts I’d like to know that we have a financial plan for. How we’re going to invest in Florida’s future and how we’re going to preserve that for the next generation. I don’t think we have a plan for that.”

But Jeb Bush maintains tax relief is key to economic growth, and he denies his proposed tax cuts are coming at the expense of other state needs. The governor says it’s a matter of getting other spending in check.

“If we reform Medicaid and deal with the class size issue, which has significant out-year costs, we can fund the priorities of this state and cut taxes,” says Bush.

But with some top Republicans now questioning that logic, the governor may have a harder sell than he thought.

The governor’s office is projecting the state may be $1.1 billion in the hole for the 2007-2008 budget year.