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A Historic Change That's Reshaping Florida's Business Landscape
Florida just made history, and if you’re a business owner, property investor, or commercial tenant in the Sunshine State, this affects you directly.
As of October 1, 2025, Florida officially eliminated the sales tax on commercial leases, a move that’s projected to save businesses across the state more than $900 million every single year. This isn’t just a policy tweak. It’s a game-changer that positions Florida as one of the most business-friendly states in the nation.
What Just Changed?
For decades, Florida imposed what many called the “business rent tax,” a sales tax that applied not only to your base rent but also to CAM charges, utilities, insurance, property management fees, and even real estate taxes. First enacted back in the 1960s, Florida was actually the last state in the country still charging this type of tax.
Governor Ron DeSantis signed the repeal into law in June 2025, and it officially took effect on October 1st. With this change, both the state-level sales tax and county surtaxes on commercial rents are now completely gone.
Why This Is a Big Deal
Let’s put this in perspective. Before the repeal, that sales tax wasn’t a minor line item. It was a real cost that businesses had to factor into every lease decision.
For a small business, it might have added up to a few hundred dollars annually. But for larger operations leasing significant warehouse, office, or retail space? We’re talking tens of thousands of dollars every year. That kind of expense directly influenced whether companies chose to expand in Florida, relocate here, or look elsewhere.
Now, that money stays in your pocket. Money that can go toward hiring new employees, upgrading your facilities, investing in equipment, or simply growing your bottom line.
What Industry Experts Are Saying
Mike Griffin, Vice Chairman at Savills and Co-Head of their Florida Region, told CoStar News that the tax had long been “a bogey out there as being this outlier that we don’t want to be.”
He went on to explain that eliminating it “will allow companies to invest more in their talent and their workplace and remain competitive,” ultimately driving economic growth across the entire state.
Industry analysts agree. The consensus is clear: this repeal will generate approximately $900 million in annual savings for tenants, spark increased leasing activity, and cement Florida’s reputation as a top destination for corporate relocations and business investment.
Who Benefits?
The short answer? Everyone involved in commercial real estate.
Tenants see immediate relief in the form of lower occupancy costs. That’s real savings you can reinvest into your operations, whether you’re running a logistics company, opening a new retail location, or expanding your office footprint.
Landlords gain a powerful competitive advantage. With no sales tax to worry about, Florida properties become even more attractive to out-of-state businesses considering a move. It’s a strong selling point that can help fill vacancies faster and retain quality tenants longer.
Brokers and advisors now have another compelling reason to market Florida properties. When you’re competing for tenants on a national scale, affordability and business-friendly policies matter, and Florida just became significantly more attractive on both fronts.
For regions like Tampa Bay, this could mean accelerated demand across warehouse, office, and retail sectors as businesses reassess their real estate strategies and take advantage of the new cost structure.
What This Means for Your Business
If you’re currently leasing commercial space in Florida, you’re already benefiting. Your effective occupancy costs just went down, and you didn’t have to do anything to make it happen.
If you’ve been thinking about expanding, relocating, or opening a new location, now is an exceptionally strategic time to move forward. The financial landscape has shifted in your favor.
And if you’re a property owner or investor, this repeal enhances the value proposition of your Florida assets. Tenants will see your properties as more cost-effective, and that competitive edge can translate into stronger lease negotiations and better long-term returns.
Our Take at Bast Commercial Group
We believe this policy change is one of the most significant developments in Florida commercial real estate in years, possibly decades.
By removing an outdated tax burden that put Florida at a disadvantage compared to every other state, lawmakers have sent a clear message: Florida is serious about supporting business growth and making it easier for companies to succeed here.
We’re already seeing increased interest from businesses reevaluating their space needs, and we expect that momentum to continue throughout 2025 and beyond. Whether it’s new lease signings, corporate relocations, or property acquisitions, the activity level is rising, and the opportunities are real.
Is Now the Right Time to Make a Move?
If you’ve been on the fence about renewing your lease, expanding into a larger space, or exploring new markets within Florida, this repeal should factor into your decision-making.
The savings are tangible. The competitive advantages are clear. And the timing couldn’t be better.
At Bast Commercial Group, we’re here to help you understand exactly how this change impacts your specific situation and where the best opportunities are emerging in today’s market.
Whether you’re a tenant looking to lock in favorable lease terms under the new structure, a landlord wanting to maximize property value, or an investor exploring acquisition opportunities, our team has the local expertise and market insight to guide you through it.
