Could corporate tax hike propel Democrat to governor's mansion?

Republicans, Florida Chamber opposed to Andrew Gillum's plan


TALLAHASSEE, Fla. – Democratic gubernatorial nominee Andrew Gillum is banking on support for an increase in corporate taxes to fund the increases in education that is one of his major campaign promises.

If Gillum wins, it won’t be the first time corporate taxes propelled an unknown candidate to the governor’s mansion. 

In 1970, Reubin Askew was an obscure Florida state senator from Pensacola when he ran on a platform of taxing corporations to fund schools.

“Polls were overwhelmingly against it,” Askew said in a 2001 interview.

The state’s top political reporter at the time wrote him off.

“She said, Rube, you didn’t have much chance to begin with. Now you’ve got none,” Askew said.

Then Askew discovered that buying a work shirt at Sears in Miami cost the same in Georgia.

“Sears paid Georgia to sell those shirts -- $500,000 a year to sell those shirts -- and people got indignant,” Askew said. 

This year, as he campaigns across the state, Gillum is proposing raising the corporate tax from 5.5 to 7.75 percent. 

“Not one Floridian will pay a dime more under our plan. Not one,” Gillum said. "This is an investment in our future and our state’s economy."

His Republican opponent, former U.S. Rep. Ron DeSantis, has signed a no-new-tax pledge." He said growth will fund Florida's needs.

As in 1970, any new revenue from a higher corporate income tax would go to fund public schools.

Businesses fiercely opposed Askew 48 years ago. They are doing the same today.

“We’d be the highest in the entire southeast,” said David Hart with the Florida Chamber of Commerce. “And we’d even have higher taxes on our companies than New York.”

But Gillum says just like the shirts in 1970, big corporations don’t change their prices from state to state.

“The truth is that the corporate tax rate in the state of Georgia is higher than that of the state of Florida, and the 99-cent menu is the same in both our states,” Gillum said.

News4Jax tested Gillum's theory Wednesday. We bought a work shirt in Tallahassee for $8, then drove 35 miles north to Thomasville, Georgia, where and bought an identical shirt by the same manufacturer from the same retailer at the same price.

Actually, the shirt purchased in Florida cost four cents more due to a higher sales tax.

GOP lawmakers are already saying no, but that could change if Gillum gets elected. Gillum is counting on Democratic gains in the state House and Senate to help him pass the corporate tax increase -- if he wins on Nov. 6.

The Florida Chamber opposes the hike, saying such a big increase will have to be passed on to consumers.

"Because companies are going to pass that cost of doing business in Florida on to consumers, so ironically, while the idea might sound good, it probably hurts the people it's intended to help," the Chamber's David Hart said.

However, prices for items purchased from national chains would likely be the same because the higher costs of business would be spread out across the entire company.

Raising the corporate tax could have the unintended consequence of funneling more money into private-school vouchers because corporations can choose to use tax obligations to support educational organizations and receive a credit from the state.