Florida Sales and Use Tax Rates by Jurisdiction
Florida, the Sunshine State, has a diverse population and an ever-growing economy. The state has different taxes in place to generate revenue for public service. Since Florida does not require its citizens to pay income tax, one of the most talked about taxes among them is the sales tax. Florida has a complex system of determination and payment of sales tax.
This is because the sales tax rate doesn’t remain uniform throughout the state and changes depending on where a product or service is sold. In this article, we will explore the sales tax rates in different counties of Florida and the formula to calculate sales tax in each county. But let’s begin with understanding the concept of sales tax first.
Why is Nexus Important in Determining NY Sales Tax Rate
Because it dictates the sales tax rate you need to charge! Each state has its own sales tax rate, so understanding your nexus in each location ensures you’re collecting the correct amount.
What Does Sales Tax Nexus Mean for Online Sellers in and Out of Florida
Sales tax nexus for online sellers in Florida determines whether a seller, regardless of physical location, needs to collect and remit sales tax on purchases made by Florida residents. It essentially defines the connection between your business and a specific state, in this case, Florida. Below is a breakdown of how to trigger sales tax nexus in Florida i.e make a connection with the state.
What Triggers Sales Tax Nexus in Florida
1. Physical Nexus: In Florida, physical nexus refers to a business having a tangible presence or activity within the state that obligates them to collect and remit sales tax. This typically applies to businesses with a brick-and-mortar location in Florida, such as a store or warehouse. However, it can also extend to other situations that establish a physical connection, like:
- Having employees, agents, or contractors working in Florida
- Owning or renting real property in the state
- Storing inventory in Florida
- Assembling, installing, servicing, or repairing products within Florida
If a business meets any of these criteria, they likely have physical nexus in Florida and must comply with sales tax regulations.
Here’s a summary of what constitutes physical nexus in Florida:
- Physical presence: Owning or leasing property, having employees or representatives in the state, or storing inventory.
- Business activities: Conducting sales, assembling products, or providing services within Florida.
2. Economic Nexus: In Florida, economic nexus refers to a business connection that creates a sales tax collection and remittance obligation for out-of-state sellers. This means that even if a business doesn’t have a physical presence in Florida (like a store or office), they may still need to collect and pay sales tax on their Florida sales if they meet a certain threshold.
Florida’s economic nexus threshold is $100,000 of sales of tangible personal property delivered to Florida customers within a calendar year. So, if an out-of-state business makes more than $100,000 in Florida sales in a year, they generally need to register with the state to collect and remit sales tax on future sales.
This law applies to both remote sellers and marketplace facilitators. Remote sellers are businesses that sell directly to Florida customers, while marketplace facilitators like eBay or Amazon connect buyers and sellers and may handle some aspects of the transaction, including collecting payments.
What is the Difference Between Sales Tax and Use Tax in Florida?
Here’s a breakdown of the difference between sales tax and use tax in Florida:
Sales Tax
- Collected by the seller at the time of purchase for taxable goods or services within Florida.
- Applies to most retail sales unless exempt (e.g., groceries).
- Florida’s general sales tax rate is 6%, but counties can add discretionary surtaxes, making the combined rate vary from 6.3% to 8.3%.
Use Tax
- Applies to the use, storage, or consumption of taxable goods or services when sales tax was not initially collected.
- This can occur in a few situations:
- Buying a taxable item in Florida without paying sales tax (rare due to seller collection).
- Buying an item tax-exempt for resale, then using it personally in Florida.
- Purchasing a taxable item outside Florida and bringing it into the state (including online purchases from out-of-state retailers exceeding $100,000 in annual Florida sales).
- Use tax rate is generally the same as the combined sales tax rate in your area.
In simpler terms:
- Sales tax: You pay it directly to the seller in Florida for most purchases.
- Use tax: You are responsible for paying it yourself if you didn’t pay sales tax when you should have.
How Florida Sales Tax System Works
Florida’s sales tax system is a combination of a state rate and potentially additional local surtaxes. Here’s a breakdown of how it works:
State Sales Tax:
- General Rate: The base sales tax rate in Florida is 6%. This applies to most taxable goods and services sold within the state.
- Exceptions: There are a few exceptions to the 6% rate. These include:
- New Mobile Homes: The sales tax on new mobile homes is lower, at 3%.
- Amusement Machine Receipts: The tax on amusement machine receipts (think arcade games) is also lower, at 4%.
- Electricity: Electricity has a slightly higher sales tax rate of 6.95%.
- Commercial Real Estate: Renting, leasing, or licensing commercial real property has a sales tax rate of 5.5%.
Local Surtaxes:
On top of the state sales tax, many Florida counties add their own discretionary sales surtax. This surtax can range from 0.5% to 2.5%, depending on the specific county. Some counties don’t levy any additional surtax at all.
Total Sales Tax Rate:
The total sales tax you pay will depend on the location of the purchase. You’ll need to consider both the state rate and any applicable local surtax. For instance, if you’re in a county with a 1% surtax, the combined sales tax rate would be 7% (6% state + 1% surtax)..
How Florida Use Tax Works
Florida, unlike some other states, doesn’t have a sales tax on income. But it does have a use tax, which applies in specific situations. Here’s a breakdown of how Florida’s use tax works:
What is Use Tax in Florida?
Use tax is essentially a sales tax you pay on certain purchases where sales tax wasn’t initially collected. It ensures that the state receives its tax revenue even when traditional sales tax isn’t applied.
When Does Use Tax Apply in Florida?
Use tax applies in a few scenarios:
- Out-of-State Purchases: If you buy a taxable good from outside Florida and bring it into the state for use or consumption, you typically owe use tax on the purchase price.
- Online Purchases: In some cases, online retailers may not collect sales tax at checkout, especially if they’re not located in Florida. In these situations, you’re responsible for paying use tax on the purchase.
- Tax-Exempt Purchases Used Personally: If you buy an item tax-free with the intention of reselling it, but then end up using it yourself, you’ll owe use tax on its value.
Who Pays Use Tax in Florida?
The responsibility for paying use tax falls on the consumer in most cases. Florida requires businesses to register and collect sales tax, but for use tax situations, the onus is on the individual.
How to Pay Florida Use Tax
Florida doesn’t require filing separate use tax returns. Instead, you report use tax on your annual Florida income tax return. There’s a dedicated section on the form to report use tax liability.
Check your Florida county rate: Florida Sales Tax Rate and Calculator
To stay compliant and manage these varying rates effectively, you can use tools like a reverse sales tax calculator or ecommerce sales tax software, which help automate the process of calculating and applying the correct sales tax rates based on location.
How Do Local Governments Add to the Sales Tax in Florida?
In Florida, local governments can add to the state sales tax through a mechanism called a discretionary sales surtax. Here’s a breakdown of how it works:
- Discretionary Sales Surtax: This is a local sales tax that counties have the authority to levy, subject to certain limitations. The surtax rate can range from 0.5% to 2%, adding to the base state sales tax of 6%.
- Voters Have a Say: The decision to implement a discretionary sales surtax typically involves a public vote. Residents of the county get to decide whether they approve the additional tax and the designated purpose for the revenue it generates.
- Revenue Allocation: The funds collected from the discretionary sales surtax are directed towards specific projects or programs as defined in the ballot initiative. These projects can vary depending on the county’s needs but often include funding for infrastructure improvements, public transportation, education, or economic development initiatives.
It’s important to note:
- The specific discretionary sales surtax rate for a particular location can vary depending on the county. Florida’s Department of Revenue publishes a yearly list of current discretionary sales surtax rates by county [Florida Department of Revenue, Discretionary Sales Surtax Information].
- There are also other local option taxes authorized by Florida law, such as the tourist development tax. However, the discretionary sales surtax is the primary way local governments can increase the overall sales tax rate within their jurisdiction.
What is the Base and Combined State Sales Tax Rate in Florida
Florida’s sales tax system consists of a base state rate and additional local rates that can vary depending on the specific location. Here’s a breakdown:
- Base State Sales Tax Rate: The base state sales tax rate in Florida is 6%. This applies to most taxable goods and services sold within the state.
- Combined Sales Tax Rate: The combined sales tax rate includes the 6% base state rate plus any additional local taxes levied by your county, city, or special taxing district. Since local rates differ, the combined sales tax rate can vary across Florida. It typically falls within the range of 6% to 8%.
Table of Florida Online Sales Tax Rate by County and Localities
The state sales tax rate in Florida is 6%. However, counties can charge a maximum of additional 2% sales tax if they want. This makes the sales tax rate in the Sunshine state range between 6% and 8%. The following table shows the sales tax rate in Florida in different counties.
| County | State Base Tax | Additional Local Tax | Total Sales Tax Rate |
| Alachua | 6% | 1% | 7% |
| Bay | 6% | 1% | 7% |
| Brevard | 6% | 1% | 7% |
| Broward | 6% | 1% | 7% |
| Charlotte | 6% | 1% | 7% |
| Clay | 6% | 1.5% | 7.5% |
| Collier | 6% | 1% | 7% |
| Duval | 6% | 1.5% | 7.5% |
| Escambia | 6% | 1.5% | 7.5% |
| Hernando | 6% | 0.5% | 6.5% |
| Hillsborough | 6% | 1.5% | 7.5% |
| Lake | 6% | 1% | 7% |
| Lee | 6% | 0.5% | 6.5% |
| Leon | 6% | 1.5% | 7.5% |
| Manatee | 6% | 1% | 7% |
| Marion | 6% | 1% | 7% |
| Miami Dade | 6% | 1% | 7% |
| Okaloosa | 6% | 1% | 7% |
| Orange | 6% | 0.5% | 6.5% |
| Osceola | 6% | 1.5% | 7.5% |
| Palm Beach | 6% | 1% | 7% |
| Pasco | 6% | 1% | 7% |
| Pinellas | 6% | 1% | 7% |
| Pol | 6% | 1% | 7% |
| Sarasota | 6% | 1% | 7% |
| Seminole | 6% | 1% | 7% |
| St Johns | 6% | 0.5% | 6.5% |
| Volusia | 6% | 0.5% | 6.5% |
As shown above, the combined sales tax rate in Florida changes from county to county depending upon how much local tax is imposed in a certain area.
Conclusion
Florida has a complex sales tax system because each county can impose an additional local tax on goods and services. This is why there is a different combined sales tax in different counties. Therefore, businesses and consumers should develop a comprehensive understanding of how sales tax works. This will help businesses avoid fines by the Florida DOR and prevent people from paying more on products than required by the state.