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Tel: +1 (905) 415-9267 or +350 200 400 48

New law helps the wealthy avoid taxes

19th Dec, 2012back

293 A brand new law in Florida, which was created with the intention of helping charities, will be assisting wealthy developers to get a lucrative tax benefit.  They have discovered a method to relocate dozens of apartment complexes off the tax rolls, thus saving themselves up to $115 million in taxes per annum; however, in the process, they will be cutting down revenues for schools and local governments, which are already hard hit in a manner that no one had been able to anticipate.


The counties of Hernando, Hillsborough, Pasco and Pinellas could end up losing out on as much as $18 million every year.  The developers claim that these tax breaks will mean they will be able to have more money with which to maintain the apartments and make sure rents remain affordable for some time to come, but the reality is that there is nothing to prevent them from simply pocketing the savings as profit.  "I'm okay with people getting rich, but I think this is unseemly," says the Homeless Services Network of Central Florida's executive director, Cathy Jackson.


Last year a law was passed by the Legislature which was intended to help Habitat for Humanity, as well as other non-profit organizations, to get a tax break so that they would be able to construct apartments for people in need.  Cunning for-profit developers, however, soon realized that they would also qualify for the same tax breaks if they created their own non-profit organizations, thus saving themselves enormous bills on every complex. 


"It's all entirely legal," notes the Florida Housing Finance Corp's general counsel, Wellington Meffert, who helps to administer the state's affordable housing programs.  "But what it will do is take a fair amount of taxable property off the tax rolls."