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ASSOCIATED INDUSTRIES’ POLL SHOWS VOTER DISTRUST OF MCKAY PLAN

January 30, 2002

TALLAHASSEE — Today, Associated of Florida (AIF) released results of a poll taken on January 27 and 28 to gauge voter reaction to Senate President John McKay’s plan to alter the state’s sales-tax code through a constitutional amendment.

Forty-eight (48) percent of the respondents believe that lowering the rate while expanding the number of taxable items would increase the amount of taxes their families pay; 26 percent believe their tax burden would drop while 25 percent are unsure of the effect.

"The truth is, the electorate knows better than some of the politicians that anything could happen if this amendment is passed," said Jon L. Shebel, AIF’s president and CEO. "No one really knows how much each of these exemptions is worth or how much people will change their spending habits after an exemption is repealed. That’s one of the problems with doing this in the constitution. It takes away the flexibility of lawmakers to react to changing situations. It also forces them to meet an artificially condensed deadline."

The survey also found that 69 percent opposed taxes on services, such as haircuts, dry-cleaning, membership dues, and residential cleaning.

"Lawmakers will have no choice but to tax services if the amendment passes," said Randy Miller, AIF’s senior executive vice president and former executive director of the Florida Department of Revenue. "Even if they repeal all of the organizational and business exemptions, they won’t find enough money to plug the hole left by the rate roll-back. They’re going to have to tax services and household items."

According to another question on the survey, 73 percent agreed that the problem to be addressed is not insufficiency of tax revenues, but too much state spending.

"The nature of government is to spend whatever it collects and always to want to spend more," Shebel said. "If the government needs more money, the business community has always been willing to offer new revenue sources that would minimize economic damage. We’re ready to do that now."

Miller added, "We think every tax exemption we support can pass legislative scrutiny. If it doesn’t, then it needs to be taken off the books. We would gladly take part in a methodical review of every exemption, but that won’t happen if lawmakers are forced to the task by a constitutional amendment."

Associated Industries of Florida is a statewide employers association representing 10,000 businesses that range from large multinational corporations to small family-owned enterprises. AIF is commonly known as "The Voice of Florida Business."