Editor’s note: Contributing columnist, Steve Nicklas, expresses his views and insight on various topics in Marketplace.
— Steve’s Marketplace —
The first guarantee in life is death. The second is the assurance you will be taxed to death. Or at least until death. And a little more after that – on your legacy, formally known as your estate.
With taxes lurking from cradle to grave, local municipalities must keep in check what they assess. And so far, they have been responsible with their tax levies for next year.
Fernandina Beach commissioners are leading the charge of frugality, with a full-blown tax cut in their plans. Nassau County commissioners could be more efficient with taxes, but it’s difficult to provide ample government services to our swelling population.
Nassau County school officials are feeling the ire of some residents. At issue is a one-mill increase in their property-tax rate to pay teachers a competitive salary. At least it was written that way in a referendum approved by voters last fall.
For local residents, the property-tax rate next year will be about 21 mills for Fernandina Beach residents, and 16 mills for people living outside the city. These tax rates include smaller levies for the likes of the St. Johns River Water Management District and the Amelia Island Mosquito Control District.
More than ever, property taxes and regulations and municipal fees carry a priority today. Many people are fleeing high-tax states to move to Florida. And with rampant inflation ignited by federal government spending, residents are getting less for hard-earned dollars.
In a closer look, taxes of many types are embedded in our society. Property taxes and income taxes are the most obvious, but only the beginning.
While Florida does not levy a state income tax, everyone pays on a federal level. The top bracket for federal income taxes is 37 percent, although most people pay at a lower rate.
Federal tax rates have been even higher in the past. However, widespread income tax cuts passed during the Trump Administration are due to expire in 2025, unless acted upon.
By the way, 42 states have their own income tax, topping out at 12.3 percent in (the Peoples Republic of) California. And many large cities also levy their own income taxes, aside from these others.
Of course, there are sales taxes of 5 to 7 percent on purchases, differing by state. Four states do not charge a sales tax. Florida’s sales tax rate is 6 percent. Some cities will also charge a one-cent or half-cent sales tax for specialty purposes, for instance.
Gas taxes are popular, since they are based upon use – and are difficult to quantify. The federal excise tax is 18.9 cents per gallon; states and cities and counties commonly pile on their own gas taxes, as we do here.
Then there are taxes on airline tickets (22 percent), cellphones (25 percent), cable television (23 percent), lodging, as well as on beer and alcohol (passed off as “sin taxes”). But let’s not forget about fees.
The average credit card fee is $128 annually, according to Forbes. U.S. citizens have on average four credit cards. And the average interest rate on credit card balances is 20 percent.
Then there are tolls on highways and bridges, parking fees, ATM fees, subscription fees for streaming services, and the list is growing. Does anyone believe taxes and fees will increase or decline in their lives?
Don’t dwell on that question for too long. It’s almost guaranteed anyway.
Steve Nicklas is the managing partner of Nicklas Wealth Management in Fernandina Beach. He is also an award-winning columnist. His columns also regularly appear in weekly newspapers in Northeast Florida and in Southeast Georgia, and on his website at www.SteveNicklasMarketplace.com. He has published a book, “All About Money,” of his favorite columns from the past 20 years. The book is available on Amazon. He has also done financial reports for area radio stations and for National Public Radio in Jacksonville. He can be reached by email at [email protected] or by phone at 904-753-0236.