Ditchmen • NUCA of Florida Ditchmen • February 2018 - Page 10

TAX LAW NEW RAISES QUESTIONS via News Service Florida Florida lawmakers are dealing with the consequences of the new federal tax law, which sharply cuts the amount of taxes paid by corporations. Lawmakers are trying to understand the impact of the Tax Cuts and Jobs Act of 2017, which took effect Jan. 1 and cut the federal tax rate paid by major corporations and businesses from 35 percent to 21 percent. It also changed deductions and other accounting methods that can alter business’ tax liabilities. Since Florida’s corporate income tax, which is 5.5 percent, is based on federal tax liability, changes in federal law can affect the amount of tax revenue the state collects from businesses. Last year, 10 DITCHMEN • FEBRUARY 2018 Florida collected nearly $2.2 billion in corporate taxes, making it one of the state’s most significant revenue sources, outside of the sales tax. Senate Finance and Tax Appropriations Chairwoman Kelli Stargel, R-Lakeland, is sponsoring an annual bill (SB 502) that conforms or “piggybacks” Florida’s corporate tax law with the federal tax code, adopting or modifying changes made at the federal level. But the piggyback bill, which is scheduled to be heard by the Senate Appropriations Committee on Tuesday, has taken on much greater significance this year because of the sweeping nature of the federal tax changes. It also must accommodate the new Bipartisan Budget Act of 2018, which was signed into law this month and also includes some changes in federal tax law. “This is a very complex issue for our corporations who look to this bill each year to try to clarify how they’re going to file their corporate income tax,” Stargel said before her subcommittee unanimously approved the piggyback bill last week. “We’re trying to recognize that right now it’s just early for everybody, so we’re trying to give some accommodation to the parts that are the most significant swings from maybe what it was last year,” Stargel said. State officials, businesses and others are waiting for