Hurricane mitigation sales tax holiday would be nice
Gov. Rick Scott‘s announcement that he will pursue legislative action to grant a 15-day sales-tax holiday for hurricane preparedness is a big win for Florida. The tax incentive will provide modest savings to those Floridians who opt to purchase things like flashlights, batteries and radios. But most importantly, it has the potential to save lives and millions of dollars in rebuilding and insurance costs on an ongoing basis.
Included in the sales-tax holiday proposal are items to help fortify and mitigate homes against hurricane damage. Given the expense of installing shutters on the average home and not having to pay a sales tax amounts to a significant discount on such an investment.
According to FEMA, each dollar spent on mitigation saves society an average of $4. These savings come not only from the decrease in physical damage when the wind blows, but also in reductions in the cost of insurance coverage — both on the individual and the state as a whole. Insurance companies already provide direct discounts to homeowners who install shutters and fortify their homes, but when Florida’s overall risk and exposure decreases because of more resilient buildings, insurance and reinsurance rates drop. This makes Florida more affordable to live in, attracts business growth, and benefits all consumers and the overall economy.
For years, the R Street Institute has proposed a hurricane mitigation sales-tax holiday as part of an overall property insurance reform agenda. This, coupled with modest reforms to reduce the scope of Citizens Property Insurance Corporation and the Florida Hurricane Catastrophe Fund, would go far in making Florida a safer and more affordable place to live.
