In 1924, voters had to make a crucial decision: whether the state should distinguish between intangible property (e.g., an item of value that cannot be touched or physically held, like stocks, bonds, or a savings account) and other forms of property subject to property taxes. At the time, Florida did not differentiate between types of property and — as a result — it was the responsibility of the individual to report intangible property. Much of it went unreported and untaxed. The amendment provided the state and property assessors the authority to seek out intangibles. Unlike the choice to outlaw personal income and inheritance taxes, voters decided to pass the intangibles tax. However, policymakers did not enact the provision until 1931, amid the Great Depression.
In 1931, when the tax was enacted, policymakers set a 2-mill annual tax on intangible property. A “millage” or “mill rate” refers to one one-thousandth of a dollar or $1 for each $1,000 assessed. By 1940, Florida’s tax on intangible property was raising more than $1 million (about 10 percent of the state’s general revenue), making it one of its most profitable revenue sources available to spend on public services. Since its implementation, policymakers have adjusted the intangible property millage rate, always staying between 0.5 to 2 mills, and they have added exemptions against the annual tax. (In 2001, they created a $250,000 exemption for each taxpayer or $500,000 for a married couple filing jointly).
Due to a long history of racist policies and practices in the form of housing discrimination, employment discrimination, and segregation, Black and Latina/o communities in Florida have experienced inequitable access to intergenerational wealth. The intangibles tax was a tool to offset wealth and income inequality in Florida, effectively offsetting some of the state’s regressive, upside-down tax burden.