Eliminating property taxes: It’s a gamble

According to the Florida Policy Institute, local governments collect approximately $42.7 billion annually in property taxes—roughly $2,000 per resident. These funds account for nearly half of the revenue for school districts and a significant portion of city and county budgets. Eliminating this revenue stream would force local governments to either slash essential services or find alternative sources of funding—most likely through increased sales taxes or fees, which disproportionately impact lower-income residents.

Governor DeSantis argues that property taxes unfairly penalize homeowners, especially as property values rise. “It’s an unrealized gain,” he said at a recent event in Tampa. “You haven’t sold it for that much; they’re just telling you it’s worth that much.” He’s right that rising assessments can lead to higher tax bills, even when local governments don’t raise rates. But the solution isn’t to eliminate property taxes altogether—it’s to reform the system to make it more equitable and transparent.

The governor’s plan would require a constitutional amendment, since property taxes are levied by local governments, not the state. That means voters would need to approve the change in a statewide referendum, likely in 2026. In the meantime, DeSantis has launched audits of municipal budgets, accusing cities of wasteful spending and inflated payrolls post-COVID. While fiscal accountability is important, it’s worth noting that many of these same areas are grappling with population growth, aging infrastructure and rising public safety costs.

Take Pensacola, for example. The city’s property tax revenue has increased by over $11 million in recent years, but its population has remained flat. Critics see this as evidence of budget bloat. Mayor D.C. Reeves, however, argues that the surge in tourism, second homebuyers and commercial activity has placed new demands on public services, even if the permanent population hasn’t grown. Eliminating property taxes would leave cities like Pensacola scrambling to maintain basic services.

And then there’s education. Florida’s “required local effort” (RLE) mandates that school districts generate a portion of their funding through property taxes. The current state budget includes $10.9 billion for RLE—up from $7.9 billion when DeSantis first took office. Without property taxes, the state would need to find a new way to fund public education, likely through higher state-level taxes or deep cuts elsewhere.

Supporters of DeSantis’s plan say it’s time to rethink how we fund government. They argue that property taxes are regressive and unpredictable, especially in volatile housing markets. But replacing them with sales taxes or consumption-based fees could make things worse. Sales taxes are less stable and hit working families hardest. And without a reliable revenue stream, local governments may be forced to privatize services or defer critical infrastructure projects.

We would like to hear more about how we fund the government without property taxes.

We think it might bring an increased sales tax, expanded consumption taxes and (dare we say it) a state income tax. These all would be terrible alternatives.

We encourage more research into this and to consider the alternatives and decide if those alternatives cost more than our property taxes.