TALLAHASSEE, FL – July 10, 2025 – In a move expected to significantly reduce the cost of doing business in Florida, Governor Ron DeSantis signed House Bill 7031 (HB 7031) into law on June 30, 2025, repealing the state’s commercial rent sales tax. The law also eliminates the local discretionary surtax currently levied by counties. The repeal takes effect October 1, 2025, marking a major shift in Florida’s tax policy and reinforcing the state’s reputation as a business-friendly destination.
What HB 7031 Means for Florida Businesses
Under current law, Florida is one of the few states that imposes a state sales tax (5.5%) on commercial rent, in addition to optional county surtaxes, which can range from 0.5% to 1.5%. This commercial rent sales tax applies to leases of office buildings, retail stores, industrial spaces, and other commercial properties.
With the passage of HB 7031, both the state tax and county surtax on commercial leases will be completely eliminated as of October 1, 2025. This tax relief will benefit a wide range of businesses—particularly small to mid-sized enterprises that lease property rather than own it—by reducing their overhead and improving their bottom line.
Legislative and Executive Support
HB 7031 received strong backing in the Florida Legislature, where it was promoted as a key part of the state’s strategy to attract new companies and retain existing ones. The bill passed with broad bipartisan support before being signed into law by Governor DeSantis, who called it “a long-overdue change that will make Florida even more competitive in attracting business investment and job creation.”
Governor DeSantis emphasized that the repeal aligns with Florida’s broader economic vision: “By eliminating this burdensome tax, we’re cutting costs for job creators and leveling the playing field. This is how Florida leads—by empowering businesses, not taxing them into other states.”
Competitive Advantage
Florida has long been a magnet for businesses due to its zero personal income tax, low regulatory burden, and pro-growth policies. The repeal of the commercial rent sales tax adds another major incentive for companies considering relocation or expansion.
Commercial landlords and tenants alike stand to benefit. Landlords will face less administrative complexity and can pass savings on to tenants. Meanwhile, tenants—especially those operating multiple locations—can achieve substantial annual tax savings.
A Step Toward Simplification
Tax professionals and commercial real estate stakeholders have applauded the move, describing it as a long-needed modernization of Florida’s tax code. In practice, the commercial rent sales tax has been difficult to administer, with confusing rules around taxability, exemptions, and varying local surtax rates. HB 7031 eliminates that complexity and brings Florida in line with national norms.
Looking Ahead
While the repeal does not take effect until October 1, 2025, businesses are already preparing for the transition. Lease agreements signed or renewed in anticipation of the change may contain tax clauses that account for the new law, and real estate professionals expect the policy shift to stimulate new leasing activity across the state.
In the broader picture, HB 7031 signals Florida’s continued commitment to pro-business reform, enhancing its appeal as a jurisdiction for startups, corporate relocations, and commercial investment.
Author: Kelly Roberts
Kelly Roberts is a business and bankruptcy attorney at Roberts Law, PLLC. She has over a decade of experience assisting businesses and business owners navigate contracts, partnership structures, negotiations, and dispute resolution. Kelly earned her Juris Doctorate from the University of Miami School of Law.
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