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Forecast shows state losing millions yearly because of tax cuts

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The state’s economic forecasters are predicting a hit to state coffers in years ahead because of tax breaks passed this legislative session.

The losses total in the tens of millions each year until 2021, according to a report posted online Tuesday.

Still, the lost revenue per year counts as less than a percent of the state’s annual budget, which this year is roughly $82 billion.

And despite the tax cuts, the state’s Financial Outlook Statement shows general revenue should nonetheless grow every year.

The Revenue Estimating Conference, a panel of legislative and executive branch analysts, revised its January “general revenue” estimates. Lawmakers rely on its forecasts to craft each year’s state budget.

After each legislative session, the panel “assesses the fiscal impact of legislation affecting state revenue collections,” its report says.

Tax and fee cuts passed this year will reduce general revenue by $42.3 million in the current budget year, which began July 1.

The losses rise to $67.4 million in 2017-18, $70.5 million in 2018-19, $73.6 million in 2019-20, and $76.9 million in 2020-21, according to the report.

Earlier this year, the Legislature OK’d and Gov. Rick Scott approved a tax-cut package for the 2016-17 fiscal year.

Among other things, it permanently eliminates the tax charged on purchases of manufacturing equipment and creates a back-to-school sales tax holiday in August.

Before joining Florida Politics, journalist and attorney James Rosica was state government reporter for The Tampa Tribune. He attended journalism school in Washington, D.C., working at dailies and weekly papers in Philadelphia after graduation. Rosica joined the Tallahassee Democrat in 1997, later moving to the courts beat, where he reported on the 2000 presidential recount. In 2005, Rosica left journalism to attend law school in Philadelphia, afterwards working part time for a public-interest law firm. Returning to writing, he covered three legislative sessions in Tallahassee for The Associated Press, before joining the Tribune’s re-opened Tallahassee bureau in 2013. He can be reached at jim@floridapolitics.com.

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