For those of us who work every day to advance the minority community, there are few things better to see than the look of pride, delight, and achievement on the face of someone who just got the keys to their first home. What once seemed impossible has now been realized, perhaps starting a family on the path to a bright future.
Homeownership brings freedom, financial stability, and a deep sense of pride in owning something. Unfortunately, today the dream of homeownership is slipping even further away for too many Floridians as they struggle to find affordable housing.
And now Washington may make things even worse. On top of a soaring housing market, a tax proposal being debated in Congress would make the dream of homeownership more unattainable by increasing the cost of insurance.
President Biden’s Made in America Tax Plan has numerous provisions, one of which would add a new Hurricane Tax by raising taxes on overseas companies – including those that sell reinsurance coverage to the insurers that protect Floridians from losses due to hurricanes and other large events.
And who will bear the brunt of these increases? Florida’s lowest earners – many of them in minority communities – who would have to pay a disproportionate share of their income for this more costly insurance.
As these added costs are passed down to consumers, they’ll impact everyone regardless of income — a bad byproduct of a tax proposal by a President who promised to protect minorities, low-income families, and small businesses.
A recent report estimated that the total increase in insurance premiums for Floridians would be up to $1.62 billion per year. That could result in Florida families paying an extra $319 per year.
As a hurricane-prone state, Florida’s premiums are already much higher than in most other states. Like millions of other Floridians, my property insurance premiums have gone up recently too. This tax hike will only make it more expensive to protect ourselves against future hurricanes and the damage they cause.
The Hurricane Tax will also increase the cost of Private Mortgage Insurance. Many first-time homebuyers, including far too many Hispanic and Black residents, are required to get this type of insurance when they can’t afford to put 20% down to buy a home. Simply put: If you can’t afford this insurance, you can’t buy a home – yet another unnecessary roadblock to homeownership.
With countless Floridians struggling to find affordable housing, do we really want to make it more expensive to buy a home? If insurance premiums continue to skyrocket, it will put the dream of homeownership more out of reach for countless families, especially minorities.
Florida’s lone Democrat on the House Ways and Means Committee, U.S. Rep. Stephanie Murphy, needs to do the right thing and prioritize the needs of her constituents.
The Hurricane Tax will hurt all of us. Congress must remove this provision before the tax bill is finalized. Otherwise, it will be everyday Floridians who pay the price and continue to struggle under the weight of our persistent affordable housing challenges.
Now more than ever, Floridians need relief – not tax rate hikes.
Julio Fuentes is the President and CEO of the Florida State Hispanic Chamber of Commerce.