Florida Eliminates Sales Tax on Commercial Leases: What Businesses Need to Know

Zachary Kamish
Jul 1
2 min read

Effective October 1, 2025, Florida will eliminate the sales tax on commercial leases, commonly referred to as the "business rent tax." This major change, signed into law as part of a larger tax relief package, marks a significant shift for landlords and tenants across the state.

At Kamish and Associates, we’re committed to helping you understand how this update impacts your business and what steps you should take to stay compliant.

Key Changes to Be Aware Of

Elimination of the Business Rent Tax

The state will no longer impose sales tax on commercial rent payments. This repeal removes a longstanding financial burden on businesses renting commercial property in Florida.

Effective Date: October 1, 2025

The repeal officially kicks in on October 1, 2025. Landlords and tenants should prepare their systems and lease agreements now to reflect this upcoming change.

Impact on Businesses

Businesses leasing commercial space will no longer need to pay sales tax on rent, reducing overhead and simplifying monthly payments.

What Landlords Need to Do

Update Invoicing and Payment Systems

Landlords must update invoicing, billing software, and lease documentation to remove the sales tax line for occupancy periods after September 30, 2025.

Watch for Exceptions

Not all leases are exempt from tax under the new law. These exceptions remain taxable:

Short-term residential rentals
Vehicle parking or storage rentals
Equipment rentals tied to a commercial lease

Additional Considerations

Successor Liability Still Applies

If you’re purchasing commercial real estate, successor liability for the seller's unpaid sales tax may still apply. Due diligence remains critical during real estate transactions.

Flood Risk Disclosure Requirement

A related law, SB 948, requires landlords to disclose flood risk to tenants signing leases of one year or longer. This promotes greater transparency and tenant safety.

No Rent Control

Remember: Florida does not impose rent control laws. Landlords retain the ability to increase rent as they see fit, with appropriate notice.

Legislative Background

This tax change was a legislative priority for Florida Realtors, who have long advocated for easing the financial burden on businesses. It was included in House Bill 7031, a broader tax relief bill signed into law to stimulate economic growth and support the business community.

If you have questions about how this change affects your lease agreements or need help updating your tax and accounting systems, the Kamish and Associates team is here to assist you every step of the way.