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Florida Tax Guide: What Retirees Will Have to Pay (and What They Won’t)

May 10, 2023 · Taxes
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What about sales tax and other taxes?

When it comes to sales and use tax, there’s a 6% tax on many (but not all) consumer services and goods. Counties may come up with an extra tax of up to 1.5%, but there are some counties that don’t levy the surtax.

There’s a maximum of $5,000 on the local surtax in various cases, including on vehicles, aircraft, mobile homes, and boats. According to the Tax Foundation, the average combined rate is 7.02%.

Regarding groceries, Florida doesn’t tax most of them, although some prepared food intended for immediate consumption (like sandwiches, for instance) is taxable. Nonprescription and prescription drugs aren’t taxed, and neither are most over-the-counter medical items and medical equipment. Contact lens solution, on the other hand, is taxable. Clothing is also taxed.

Florida’s use tax applies to things purchased out of state when brought into the Sunshine State within six months of the purchase date. Examples include furniture delivered from another state and items bought online. The use tax doesn’t apply if you paid a sales tax of 6% or more to the out-of-state seller.

Florida’s gas tax is adjusted annually. As of January 1, 2023, the state’s gas tax is 0.35225, which is 0.018 cents more per gallon compared to 2022. The gas tax rates also vary by county.

When it comes to alcohol, wine is taxed between $2.25 and $3.50 per gallon, depending on its alcohol content and whether it’s sparkling wine. Beer is taxed at $0.48 per gallon. The tax rate for liquor varies between $2.25 and $9.53 per gallon, depending on the alcohol content. The purchase of wine, beer, and liquor is also subject to the state’s general sales tax plus any extra surtax imposed by the country.

Florida also doesn’t levy a commuter tax. In 2023, Florida drivers will get a 50% discount on tolls provided they have at least 35 toll transactions during a month.

There’s no tax on lottery winnings in Florida, but you’ll still have to pay federal income tax on your prize money.

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