Florida Ends Sales Tax on Commercial Leases — Effective October 1, 2025
Published: July 2, 2025
What’s changing?
Under House Bill 7031, recently signed by Gov. DeSantis, Florida will fully repeal both the state (2%) and all local discretionary sales taxes on commercial real estate leases—a significant relief for tenants statewide—starting October 1, 2025
| Topic | Guidance |
|---|---|
| Taxable periods | Tax applies for occupancy through Sept 30, 2025, even if rent is paid later (gtlaw.com). |
| Prepayment window | Prepaying Oct or later rent before Oct 1, 2025, means no sales tax will be due on that portion . |
| Non-commercial rentals | Short-term residential, parking, boat/aircraft storage, and equipment remain taxable under other statutes . |
| Audit liability remains | The repeal isn’t retroactive. Prior periods are still open to audit, and successor liability applies—landlords may want to continue filing "zero‑tax" returns post-Oct 1 to secure compliance certificates . |
What Miloff Aubuchon clients should do now
- Review active leases to determine which rent periods fall before vs. after Oct 1, 2025.
- Update billing systems to automatically remove sales tax for leases starting Oct 1 onward.
- Communicate with tenants and subtenants—clarify that tax no longer applies to future rent charges.
- Assess strategic benefits: consider adjusting quoted rents or incentives to reflect tax savings.
- File zero returns post repeal to secure clean compliance certificates and support future property transfers.
Bottom line
This repeal marks a pivotal shift in Florida’s commercial real estate landscape. By eliminating the state’s longstanding sales tax on commercial leases, HB 7031 delivers substantial, recurring savings and simplifies transactional workflows. Both landlords and tenants should prepare now—review lease structures, update billing platforms, and proactively communicate to fully leverage this change.
Miloff Aubuchon Realty Group's Commercial Division is here to help. Need support adjusting lease language or reviewing property portfolios? Reach out to our experienced team for personalized guidance.