Punta Gorda Local Business Tax: Affecting Both Employers and Employees Alike

Written by Will W. Sunter | wsunter@farr.com

 

Will W. Sunter | How Do I Get Them Off My Property? | Farr Law | Serving Southwest Florida (image)

Attorney Will W. Sunter
Will focuses his practice on litigation with an emphasis on civil, real property and probate matters as well as guardianship.

Recently, business owners in Punta Gorda, Florida have received letters from the City Clerk requesting a list of all employees who have some form of license, certificate or registration from any state or federal regulatory body, agency, board, division, or commission.  The reason for this is the City of Punta Gorda is intending to tax such persons.  This tax arose from a recent Attorney General’s Opinion issued to the City. In 1972, the City of Punta Gorda adopted an ordinance that imposed an occupational license tax on all persons, firms, or corporations maintaining a business within the city limits.  Historically, this tax was only collected from the business, not the license holders in the business.  In the Attorney General’s Opinion 2010-41, the Attorney General informed the City’s Attorney that the business tax must be imposed upon all license holders within city limits.  This means that each individual license holder is responsible for the business tax, as well as the business that employs them (e.g. an accounting business would pay the tax once for the business, and then again for each of the license holders employed by the business). Based on this Attorney General’s Opinion, the City of Punta Gorda has requested information from all business owners so it can impose the tax on all license owners doing business in the city.  The current cost for each license holder is $105.00.  For a large business within the limits of Punta Gorda, this yearly tax can be thousands of dollars. Pursuant to the Attorney General’s Opinion, if the City wants to stop the tax from affecting each of the license holders, it must change the classification structure of the ordinance.  Before the City may change the classification structure, it must appoint an equity study commission.  The City has already created an equity study commission, which is a representative panel of local business people operating within the city limits.  The equity study commission will make its recommendations with regard to possible reclassification of businesses and the tax rate for each of those businesses. Until such time as the recommendations of the equity study commission have been made and ratified by the City Council, the business tax will affect more persons than it affected in the past.  In theory, the tax will create a windfall for the City of Punta Gorda, but, at the same time, may scare away larger employers’ who employ a large amount of license holders.  All of this may be resolved through State legislation.  The Charlotte Sun reported on January 27, 2011 that State Rep. Ken Roberson filed a bill to prohibit cities and counties from levying a business tax on state-licensed professionals if they work in businesses that already pay the tax.  Stay tuned to this blog for updates on the status of Punta Gorda’s occupational license tax.