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Florida Supermajority Requirement for Tax Increases Goes Into Effect

February 1, 2019

Two-thirds of Floridians voted in November to require a supermajority of state legislators to approve tax increases.

Florida has joined at least 14 other states that require supermajority consent in both houses of the state legislature in order to increase taxes.

Two-thirds of Floridians voting in November 2018 approved Amendment 5 to the state constitution, well above the 60 percent threshold required to pass the measure.

The amendment “[p]rohibits the legislature from imposing, authorizing, or raising a state tax or fee except through legislation approved by a two-thirds vote of each house of the legislature,” the ballot language states.

Some tax hikes in Florida require an even higher supermajority, says Matthew Glans, a senior policy analyst for The Heartland Institute, which publishes Budget & Tax News.

“The Florida Legislature must get approval from three-fifths of each legislative chamber before imposing any corporate tax increase,” Glans said.

In addition, any new taxes must receive approval by a supermajority of voters, says Glans.

“Florida law also requires any proposed constitutional amendment imposing a new state tax or fee to be approved by two-thirds of the voters in the next election held after such an amendment is considered,” said Glans.

Popular Option

Several other states require a supermajority of the legislature for approval of budgets, taxes, or other finance-related measures, according to the National Conference of State Legislatures.

A two-thirds supermajority of legislators is required for tax increases in Arizona, Arkansas (except on sales and alcohol taxes), California, Colorado (waived in emergencies only), Florida, Louisiana, Missouri, Nevada, South Dakota, and Wisconsin (on sales, income, and franchise taxes).

Nebraska and Rhode Island require approval of two-thirds of each house of the legislature to pass budgets, and Illinois requires a three-fifths majority for budgets passed after June 1.

Arkansas, Michigan, and Oklahoma require approval by a three-fourths majority of each house of the legislature for taxes, and Delaware, Mississippi, and Oregon require three-fifths.

In addition, several states have miscellaneous supermajority requirements for spending, according to the NCSL. For example, Connecticut requires three-fifths of each house of the legislature to approve spending exceeding state expenditure caps, and Hawaii requires two-thirds of each house of the legislature to bust its spending caps.

Kentucky requires three-fourths approval by each house of the legislature for raising revenue or appropriating funds in odd-numbered years and a simple majority for raising revenue or appropriating funds in even-numbered years.

Massachusetts requires a two-thirds majority of each house of its legislature to approve its annual capital budget. Michigan requires a three-fourths supermajority in each house of its legislature to appropriate public money or property for a local or private purpose. North Dakota requires a two-thirds supermajority in each house of its legislature to approve emergency spending.

‘A Solid First Step’

Glans says Amendment 5 will help Florida control spending.

“Supermajority requirements are a solid first step toward reining in out-of-control state budgets,” said Glans.

“States must learn to live within their means and adopt reforms that limit spending,” said Glans. “Controlling spending would force the government to more closely monitor and limit state spending, thereby properly balancing the budget while limiting the need for future tax hikes,” Glans said. “These new rules ensure any tax passed has reached consensus and received full consideration.”

‘Consistency In The Tax Climate’

Sal Nuzzo, vice-president of policy at the James Madison Institute, a Florida think tank, says the supermajority requirement will encourage business owners to flock to Florida because of the more predictable tax environment it creates.

“One of the biggest challenges Florida has in the next 25 years is diversifying our economy,” Nuzzo said. “We’re beginning to see more activity in things like financial services and high-tech manufacturing, and they need to continue to maintain growth.

“This amendment would guarantee a high degree of consistency in the tax climate,” said Nuzzo. “Consistency in taxes lets business leaders know what their outlooks will be when they look for where to start and invest in businesses.”

The supermajority requirement means legislators will have to find ways to balance the budget other than raising taxes, such as cutting unnecessary spending, says Lew Uhler, president of the National Tax Limitation Committee and a policy advisor for The Heartland Institute.

“The balanced-budget requirement is part of the state’s constitution, and by increasing the threshold, you restrain those who try to increase the total tax load as a means to balance the budget,” Uhler said. “Making this threshold for increase a part of the constitution is a wise approach for the people.”

Sarah Quinlan (think@heartland.org) writes from New York City, New York.

Internet Info

Matt Glans, “Oklahoma Should Not Weaken Its Supermajority Tax Requirement,” The Heartland Institute, April 12, 2018:

https://www.heartland.org/publications-resources/publications/research--commentary-oklahoma-should-not-weaken-its-supermajority-tax-requirement

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