Florida Senate - 2020 SB 1778 By Senator Gruters 23-00609B-20 20201778__ 1 A bill to be entitled 2 An act relating to taxation of real property; amending 3 s. 212.031, F.S.; exempting from the sales and use tax 4 certain property that is rented, leased, subleased, or 5 licensed to a specified small business; providing 6 definitions; providing application procedures; 7 requiring the Department of Revenue to approve or deny 8 such application within a specified time period; 9 providing requirements for the department and the 10 small business; providing for expiration of the 11 approval letter; providing renewal procedures; 12 providing an effective date. 13 14 Be It Enacted by the Legislature of the State of Florida: 15 16 Section 1. Subsection (10) is added to section 212.031, 17 Florida Statutes, to read: 18 212.031 Tax on rental or license fee for use of real 19 property.— 20 (10)(a) The rental, lease, sublease, or license of real 21 property to a small business is exempt from the tax imposed by 22 this section. 23 (b) For purposes of this subsection, the term: 24 1. “Small business” means a business that employs nine or 25 fewer total employees at all of its business locations which are 26 related through common ownership and whose business activities 27 are integrated with, dependent upon, or contribute to the flow 28 of value among such locations. 29 2. “Total employees” means all full-time and part-time 30 employees currently employed by a small business at all of its 31 business locations, wherever they are located, and includes any 32 person performing services for the small business under an 33 employee leasing arrangement as defined in s. 468.520(4). 34 (c) To receive an exemption under paragraph (a), a small 35 business must submit a completed application to the department 36 containing the following information: 37 1. A statement that the small business is seeking the 38 exemption provided in this subsection. 39 2. The name, mailing address, and, if applicable, the 40 federal employment identification number and business partner 41 number of the small business. 42 3. A list of the physical addresses of each of the small 43 business’s business locations in the state. 44 4. A copy of the small business’s most recently signed and 45 filed Florida Department of Revenue Employer’s Quarterly Report 46 (RT-6) documenting that nine or fewer employees were employed 47 during each of the months within the most recently filed RT-6, 48 if such small business was required to file the RT-6. 49 5. A sworn statement, under penalty of perjury, executed by 50 a duly authorized officer or agent of the small business 51 certifying the number of total employees employed by the small 52 business and attesting to the accuracy of the information 53 included in the application. 54 (d)1. The department must review each application to 55 determine whether it is complete. If it is not complete, the 56 department must notify the small business and specify the 57 additional information necessary to complete the application. 58 2. The department must approve or deny each complete 59 application within 30 days after receiving it. The department 60 shall review and verify the small business’s eligibility for the 61 exemption by confirming that the number of total employees in 62 the certification statement and the number of total employees 63 listed in the RT-6 is nine or fewer, if the RT-6 was required to 64 be submitted. 65 3. If the department determines that the small business is 66 eligible for the exemption, it must issue an approval letter to 67 the small business that includes the name of the small business, 68 a list of all of the small business’s business locations in the 69 state, a statement that the small business qualifies for the 70 exemption under this subsection, and an expiration date that is 71 1 year after the last day of the month in which the approval 72 letter was issued. 73 4. If the department is unable to verify the eligibility of 74 the small business, the department must issue a denial letter to 75 the small business explaining the reasons for denial. 76 (e) To obtain the exemption under this subsection, the 77 small business must submit the approval letter to the landlord, 78 lessor, or licensor. The exemption applies only during the time 79 that the small business occupies, uses, or is entitled to occupy 80 or use the real property regardless of when a rent or license 81 fee payment is due or paid. The applicable tax under this 82 chapter may not be avoided by delaying or accelerating rent or 83 license fee payments so that they are paid during a period 84 covered by the approval letter. 85 (f)1. An approval letter is valid for 1 year after the last 86 day of the month in which it was issued. To continue receiving 87 the tax exemption without interruption, the small business must 88 submit a new application to the department at least 45 days 89 before the approval letter is scheduled to expire. 90 2. A small business that does not reapply within the 91 timeframe specified in subparagraph 1. may submit a new 92 application to the department at any time. Any rental, lease, 93 sublease, or license of real property to the small business 94 after a previously issued approval letter has expired is subject 95 to the applicable tax under this chapter unless it is otherwise 96 exempt. 97 Section 2. This act shall take effect January 1, 2021.