TALHASSEE – An important source of Orlando’s tourism industry’s tax revenues is witnessing the eyes of the Florida home to use money raised from visitors to give homeowners property tax credits.
The House tax package will transform the tourism development tax and overturn the key means of marketing agencies visiting Orlando and funding entertainment and sports venues like the Kia Center, home of Orlando Magic.
The proposal calls for the acquisition of money raised from tourists and use it to provide Florida homeowners with credit on the property tax bill. For Orange County, a tourist-rich country, the change affects approximately $360 million in annual tax revenues paid by visitors staying in hotels and short-term rentals.
“I think it’s the most drastic change in the TDT (Tourist Development Tax) since Orange County first approved it,” Orange County Commissioner Phil Diamond said of the House proposal. “I think there are a lot of unknowns. Everything seems to be moving at the speed of sound. We are clearly in unknown waters right now.”
Gov. Ron DeSantis is seeking property tax relief, and he argues that he wants to convince tourists more than homeowners, but he and the House and Senate leaders have not agreed to whether or how to do so.
DeSantis says “we will tax tourists.” Some foreigners will be taxed. “Suppressing other revenue losses
Tourism industry representatives argue that hotel tax revenues are essential for Florida to remain competitive with other destinations and oppose the House plan.
The House’s proposal is “a job killer, not a tax cut,” Paul Bales, vice president of the Amelia Island Conference & Visitors Bureau, told lawmakers at a legislative hearing on Tuesday.
“Without marketing, Florida would lose visitors, Florida would certainly lose jobs, and Florida would lose tax revenue as a result,” he said.
Meanwhile, two Orlando Democrats who pushed for TDT reform say the county needs flexibility in how it uses revenue, whether it’s funding mass transport projects or reducing property taxes.
House and Senate budget negotiators will draw out details on the final day of the legislative meeting, which is scheduled to end May 2nd.
Under the House proposal, the county can use hotel tax revenues to continue to liability for projects launched by July 1, or fulfill contracts concluded as of January 1, according to the proposal. However, starting from the 2026-27 budget year, revenues must be used to offset the county’s property taxes.
The proposal would also disband the Tourism Development Council, the governing body responsible for attracting visitors. Orange County Tourism Development Tax Revenue, generated by a 6% tax on hotel stays and short-term rentals, will be used for visits, Orlando, convention centers, stadiums, art venues and museums.
Orange County has many debt obligations with TDT funds totaling hundreds of millions of dollars. That money is funding the expansion of the Orange County Convention Center, improving FBC Mortgage Stadium on the University of Central Florida campus, and upgrading to the KIA Center and Camp World Stadium. It has been used to help build the Dr. Phillips Center for the Performing Arts and has seduced the area major events such as the NFL Pro Bowl.
This week, the commissioner approved an incentive total of $29 million to seduce the Jacksonville Jaguars to play the 2027 season at Camp World Stadium. These events include WrestleMania.
When Orange County voters approved it imposed in the late 1970s, one of the conditions was that property taxes could not be used to maintain the convention center. Without the TDT, Diamond said he doesn’t know how the county could pay for maintenance, such as replacing roofs and conditioning units. Such expenses total tens of millions of dollars a year.
Orange County lobbyist Mark Jeffries officially opposed the package at Tuesday’s hearing but did not speak.
The Senate tax package will also disrupt tourist taxes, although to a lesser extent than the House plan. The Senate proposal would ease the requirement that at least 40% of the revenue be used for tourism advertising.
The measure, introduced by State Senator Carlos Guillermo, sets mandatory tourism spending requirements of less than $50 million, or about half of what Visiting Orlando is currently spending on visits.
Smith, an Orlando Democrat, said the House plan doesn’t provide enough flexibility for local governments. He hopes tourism tax revenues will move from tourism advertising to expanding Sunrail.
“The House of Representatives’ proposals are extreme and will undermine central Florida’s ability to fund tourism-related needs,” he said. “The county needs more flexibility to invest in destination infrastructure, such as transportation, labor housing, and public safety, and less for wasted corporate tourism advertising.”
“Big things for Central Florida”: Hotel tax shakeup gains momentum
State Rep. Anna Eskamani of D-Orlando said her focus is to ensure reforms that “give flexibility while maintaining local control.”
Orange County Commissioner Kelly Semrad said the Senate proposal would be a boon for the county, releasing at least some of the lucrative bed taxes spent on improving transportation for the benefit of both visitors and residents.
“I think this is a victory,” she said. “In the end, these are $1 billion companies, and this is a public tax, and this public tax should benefit the public.”
Semrad, an associate professor at UCF’s Rosen Hospitality Management College, said he supports laws that will flexibly use taxes to the county for local needs, including affordable housing, transportation and fighting the homelessness.
She is skeptical of the House proposal and allows money to replace some of the property taxes instead.
“That doesn’t suit me,” she said.
The proposal could change as negotiations unfold, state Senator Wyman Duggan, who introduced the bill, said. Jacksonville Republicans said lawmakers are looking for “innovative” ways to provide immediate property tax relief.
“The cakes are not baked,” he said at a hearing Tuesday. “There’s a long way to go.”
