Advocacy
Manufacturing Machinery and Equipment Issue Brief
Background:
Florida’s ports are critical to the import and export of goods in our state. Increasing the manufacture of Florida goods has been identified as a key strategy to increasing exports and therefore increasing international trade in Florida.
International trade is a pillar of Florida’s economy and presents significant opportunities for growth. Waterborne international trade moving through these seaports was valued at $82.7 billion in 2011, increasing by 18.7 percent from 2010, and represents 55.4 percent of Florida’s $149.4 billion total international trade.
Current Issue:
Florida has the ideal geographic location and is building the necessary freight infrastructure to become the primary gateway for manufacturers to reach international economies. With 95 percent of manufacturers’ potential customers located outside of the United States, Florida seaports are critical to the efficient movement of their goods to the world marketplace.
Florida’s leadership has already invested heavily in seaport infrastructure, recognizing that
Florida will not be able to compete in the global market without an efficient and seamless freight infrastructure in place. However, with manufacturing being a key to increasing exports and trade, other obstacles to competitiveness must also be addressed, such as the sales tax on manufacturing machinery and equipment.
Manufactured goods account for between 85 to 90 percent of all Florida exports. There will soon be increased opportunities for Florida exporters with the completion of critical seaport infrastructure improvements around the state. Florida manufacturers will be able to take advantage of more efficient and lower-cost shipping to and from global markets around the world. Florida’s next step is to create a welcoming environment for that industry by removing unnecessary barriers.
Recommendation:
The Florida Ports Council recommends eliminating the current sales tax on manufacturing machinery and equipment to allow Florida’s existing manufacturers to take advantage of reduced costs to expand and make additional capital investments, and to attract out of state or international manufacturers considering relocating or expanding to Florida.