Governor Ron DeSantis rolled out a plan on Wednesday for a sweeping cut in property taxes that includes a November ballot proposal that would raise the homestead exemption to $250,000.
The exemption currently reduces the assessed value of a primary home by up to $50,000, thus providing a tax benefit.
DeSantis is calling the Florida Legislature to Tallahassee for a three-day special session, beginning Monday, June 1, to work on the initiative.
A supermajority of 60 percent in both chambers will be required to put a proposed constitutional amendment on the ballot in the November 3 election. The same percentage of voters would be needed to approve it.
Besides raising the homestead exemption, DeSantis’s plan would require lawmakers to carve a path for the elimination of property taxes for the great majority of Floridians who own the homes they live in. The ballot measure would eventually step the exemption up to $500,000, wiping out property taxes for 92 percent of homesteaded Floridians, according to the governor.
DeSantis’ proposed property tax plan does not explicitly protect school districts from revenue losses. While the plan requires local governments to use remaining property tax revenue solely for “core public needs” like education and public safety, it does not mandate specific funding levels for schools.
Only the first $25,000 of the existing $50,000 exemption applies to school districts, which rely heavily on property tax revenue to fund their budgets.
DeSantis’s plan also calls for placing a 5 percent cap on annual increases in the value of non-residential and commercial properties. Anyone who moves to Florida after January 1, 2027, would have to wait five years before they are eligible for the bigger tax break.
“I think a lot of people need relief,” DeSantis said at a news conference in Tampa. “I think a lot of people have been wondering, ‘Where can we get it?’ We’re showing a pathway to be able to get that done that I think is going to be transformational for people.”
DeSantis has been talking since March 2025 about eliminating property taxes entirely. His plan doesn’t do that, but it would unleash a tectonic shift in funding for local governments that rely on property tax revenue not only for public safety but for other core services ranging from capital improvements to picking up trash.
DeSantis said he’s proposing a multibillion-dollar state trust fund to provide grants to local governments that would need assistance with the transition.
Impact on Palm Beach
The Town of Palm Beach relies on property tax revenue to fund roughly two-thirds of its annual budget, which this year stands at $127.3 million.
Bob Miracle, Palm Beach’s deputy town manager for finance, told the Palm Beach Civic Association that, because of its relatively high property values, Palm Beach is in better shape than most municipalities to withstand a steep increase in the homestead exemption.
An exemption of $250,000 or $500,000 is a smaller percentage of home values in Palm Beach than in most other communities, Miracle said. The average sale price for properties in town in recent years exceeded $2.5 million.
But Miracle said the impact on town finances could still be substantial.
The town relies on property tax revenue not only for police and fire services, but for capital projects including drainage and coastal construction improvements, retirement pay, recreational services and daily trash pickup.
Miracle told the Town Council in January that a substantial cut in property taxes would force the town to research options to replace the lost revenue. Those options, he said, include hiking the property tax rate on non-homesteaded owners; new assessments for town services; increasing other revenue sources; including parking, the business tax, and recreation fees; and outsourcing services to reduce impacts to the town budget.
“This can hit a lot of different services,” Miracle told the Civic Association this week. “We have to do our evaluation as to what the actual impact will be. This is a developing story.”
Property owners on the island pay a tax rate of $2.61 per $1,000 of taxable value to the town, which accounts for 17 cents of every property tax dollar. The remainder is split between Palm Beach County, the county school district, and other taxing authorities.
Virtually every property in Palm Beach has an assessed value above $250,000. Roughly 40 percent of properties have the homestead exemption.
A ‘risky path’
Mark Zeidman, a Civic Association director and chair of its Tax and Finance and Audit committees, said the governor’s proposal is still a “moving target” so it is premature to estimate with confidence its impact on Palm Beach’s property tax revenue.
A similar proposal to increase the homestead exemption to $250,000, discussed in the Florida House several months ago, suggested that the reduction in Palm Beach’s revenue would be about $2 million, Zeidman said.
“In the short term, [the governor’s] proposal would appear to be less disruptive of town finances than others,” Zeidman said. “In the longer term, if the goal is to completely eliminate property taxes, it is risky to embark on this path without some realistic plan in mind that would continue to fund core local services. And from a governance perspective, reducing the town’s control over its main source of revenue dramatically shifts the balance of power from local government to the state. I’m not sure why this is a good thing.”
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