Wealth taxes are crucial tools for addressing generations of systemic injustices that have made it harder for Black and brown communities, as well as Floridians of all races paid low wages, to access the best-paying jobs, quality education, and other opportunities to build wealth. Unfortunately, in 2006, policymakers repealed the intangibles tax once approved by voters. Due to a history of unequal access to intergenerational wealth, this change in the tax code disproportionately benefited wealthy white residents at the expense of tax fairness in the state. Intangible property like stocks and bonds, which comprise a large share of the assets of the wealthy, is not taxed until the owner sells it, at which point capital gains are taxed. While capital gains count as personal income, the gains generated by an intangible asset’s rise in value are taxed at a lower rate than wages and salaries. And, since Florida does not have a personal income tax, the state has no way of collecting capital gains aside from its voter-approved intangibles tax.
Like inheritance taxes, Florida’s intangibles tax offered an opportunity to raise revenue and offset the state’s regressive tax burden on communities of color. If they reinstated a 2 mill annual tax (i.e., a tax rate of 0.2 percent) on intangible property, policymakers could raise up to $2.2 billion. This is the only way to adequately tax capital gains in Florida given the lack of a state personal income tax, and it is a much-needed policy to offset wealth and income inequality. The revenue could be spent on good schools, safe and affordable housing, reliable transportation infrastructure, clean water and energy, and a robust safety net to the benefit of all Floridians.