The Dolphins didn’t propose ending the tax credit when team lobbyists first crafted the stadium-subsidy bill, but the team has not objected to the provision since it was added. The issue gets more complicated since the team’s top lobbyist, Ron Book, also is paid by Miami-Dade as one of its lobbyists. When it was first tacked onto the bill in January, Book said “there is nothing wrong with the amendment” since lawmakers see the banking tax break as “outdated.” A team spokesman said this week the Dolphins would not comment on the banking provision.
A House version of the Dolphins bill would not impact the banking deduction, so finance lobbyists hope the effort to kill the subsidy would die there even if the stadium legislation passes the Senate on Thursday.
Removal of the banking tax credit is part of a wider effort by the Legislature to rollback tax breaks. The banking provision was created 30 years ago to lure foreign banks to Florida. Under the law, banks with Florida operations can take income from foreign depositors and loans and deduct those profits from revenue earned by the bank’s domestic operations in the state.
One problem is Florida allows the deduction no matter where in the United States the bank chooses to place its international banking operation — an option barred by federal banking law when Florida first adopted the deduction. Other states, including New York, have similar deductions but only for foreign banking centers within their states.
The Florida International Bankers Association estimates between five and 10 banks receive the Florida deduction but have their international-banking facilities elsewhere, while 15 to 20 banks have their international operations in Florida. All of those are based in the Miami area, according to FIBA.
Schwartz, the FIBA president, said he would rather have the Legislature tweak the law to remove the deduction for out-of-state international transactions so that Florida-based banks wouldn’t see their profits hurt.
“We’re a signature industry,’’ he said. “A lot of the economic recovery that has happened here is because of foreign investment.”