By Jackie Llanos and Jay Waagmeester, Florida Phoenix
The GOP-led Legislature approved a $115.1 billion budget for the next fiscal year, plus a $1.3 billion tax cut package, nearing midnight on Monday after a tumultuous and unusually long legislative session.
Related: Public funding of education agreed to; policy still outstanding.
The final votes came more than six weeks after the scheduled end of the typically 60-day session and just two weeks ahead of the July 1 beginning of the new fiscal year, as legislative leaders wrangled over the state’s spending pace and dueling tax cut proposals.
“In my knowledge, there’s been no other process of a budget like this year,” said Senate Budget Chair Ed Hooper. “We are in Day 105. We have had shouting matches; we have had finger-pointing with our friends across the rotunda. We’ve had discussions, but at the end of the day, we sat down and we got a deal.”
Lawmakers are celebrating that the 2025-26 budget is $3.5 billion smaller than this year’s and half a billion less than Gov. Ron DeSantis’ proposal. The Senate unanimously voted for the budget, whereas two Democrats in the House voted against it.
Done deal: Florida legislators reach budget, tax agreements
Who’s getting what in tax cuts?
When it came to taxes, the legislative leaders settled on a package, 70% of which will go toward permanently eliminating the sales tax on commercial leases. Eliminating the tax on business rents — Florida is the only state that has such a tax — is projected to lower revenue by $904.8 million.
Other tax exemptions that will benefit businesses include the full repeal of the aviation fuel tax, a 2% reduction in cardroom taxes, and the exemption of NASCAR Championship Race tickets from taxes. The tax package unveiled on Friday also includes recurring sales tax exemptions for back-to-school items during August, as well as year-round supplies for hurricane preparation and state park admissions, among other items.
Overall, the tax package lawmakers approved represented a departure from the proposals that led to the breakdown in budget talks during the regular session. House Speaker Daniel Perez on March 26 dropped the big idea of permanently lowering sales taxes by .75%, saving taxpayers nearly $5 billion annually. In response, Senate President Ben Albritton proposed a plan to exempt taxes on clothing priced under $75.
Both leaders rejected the notion that the final package didn’t deliver as big of savings for Floridians as their original ideas.
“I don’t think it’s fair to minimize the major expansion and creating the recurring nature of the back-to-school and the disaster,” Albritton said, referring to those sales tax exemptions. “Those are two things that Florida families see huge value in.”
House Speaker Daniel Perez answers questions from reporters on the last day of the 2025 regular session on June 16, 2025. (Photo by Jay Waagmeester/Florida Phoenix)
Perez had criticized the governor for touting sales tax holidays as the feud between the two escalated earlier in the year.
“We’re passing the largest recurring tax cut in the history of the state of Florida, that was the goal of the House,” he said, saying that his plan to permanently lower sales taxes would have been just one way of achieving the goal.
Not only does eliminating the business rent tax strengthen the economy, it directly helps Floridians who own shops, the legislative leaders told reporters ahead of the vote Monday night.
“When I think of eliminating the business rent tax, I think about the mom and pop locks in the shop, that is who we are helping,” Perez said. “It’s very easy to judge the conclusion that you’re helping a Walmart, for example. No, what you’re helping is, you’re helping small businesses.”
While the tax package drew bipartisan support, an association representing local governments asked the lawmakers Friday to maintain the revenue stream for counties. Seven Democrats in the House and two in the Senate voted against the tax package.
“The majority of these local option taxes were voted on via referendum by the local citizens, including local business owners, to fulfill important needs ot the local community like local transportation, and local hospitals, and other critical infrastructure,” said Jeff Scala, deputy director of the Florida Association of Counties.
Still, Senate Democratic Leader Lori Berman, who voted against the tax cut deal, said most of the savings benefited businesses over Floridians.
“We’re not putting any new, great ideas in here to really help the individual citizens in the state of Florida,” she said.
Saving for a potential recession
Since lawmakers returned to Tallahassee to hash out the budget, they have emphasized a plan to stash $1.5 billion over the next two fiscal years in the Budget Stabilization Fund to weather a potential recession.
Although Hooper and Albritton had expressed that the emergency fund could help Florida get through the looming federal funding cuts, the Senate leader took a more reserved tone on Monday, saying that he supports President Donald Trump’s approach to rein in federal spending.
Democrats had argued during budget talks that if the state would soon need to shore up more funds to pay for Medicaid, food assistance programs, and emergencies, putting the money in a restricted fund would make it more challenging to navigate those changes.
Lawmakers last dipped into the Budget Stabilization Fund, which now contains $4.4 billion, during the Great Recession.
Other budget deets
The budget includes a 2% raise for state employees, with a minimum increase of $1,000 per worker.
In the education silo, the budget increased by $945 million, and 71% of that new money will be funded by local property taxes. The increased reliance on local property taxes comes amid a push from the governor’s office to eliminate property taxes, with lawmakers agreeing to fund a study on the effects of repealing the tax.
The K-12 education budget is $34.6 billion, with $20.9 billion funded by state and federal funds, while the remainder is up to local governments. The higher education budget totals $11.7 billion, of which $8.9 billion is state and federal funds.
Jewish day schools and public schools will get $20 million each to harden security. The budget includes $637.7 million for the Bright Futures scholarship program and no college tuition increase.
As part of the K-12 agreement, the chambers compromised on allocating an additional $101.6 million toward teacher salary increases statewide, targeting an area where Florida has lagged.
The budget includes more than $120 million for the Florida Department of Agriculture and Consumer Services for the citrus industry, including $104.5 million for research.
In the final budget deal, Albritton compromised on funding two food grant programs through FDACS, securing $38 million for food bank infrastructure and for farmers to grow food for those food banks. However, that was $12 million less than what he originally wanted.
