DeSantis is teed up to repeal Disney’s special tax status after House vote
Following weeks up publicly criticizing Disney for its opposition to the state’s ‘Don’t Say Gay’ bill, Florida Governor Ron DeSantis is now positioned to deliver a major blow to the entertainment company’s autonomy and financial power.
Florida policymakers today issued the final approval to eliminate a special tax district in the state that gives Walt Disney Co self-governing rights over its properties. After passing yesterday in the state Senate, the bill, proposed by Republican Governor Ron DeSantis, passed today in the state House in a 70-38 vote.
DeSantis strikes back at Disney
DeSantis has for weeks been publicly attacking the media and entertainment giant for its condemnation of the state’s controversial House Bill 1557, known colloquially by opposers as ‘Don’t Say Gay.’ The legislation, which was signed into law last month, bans the teaching of gender issues to students younger than third grade. In a statement published last Month, Disney said: “Florida’s HB 1557, also known as the ‘Don’t Say Gay’ bill, should never have passed and should never have been signed into law.” Apparently incensed by the company’s opposition to the bill, DeSantis earlier this week convened a special session to take up a measure to repeal a 1967 law giving Disney a special tax status.
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Disney, like other major corporations, have faced increasing pressure in recent years to take a stance on oft-controversial social and political issues. Consumers express their opinions with their dollar — and all signs point to higher spending with brands who make social, political and environmental purposes central to their messaging and integral to their operations. An Ipsos study conducted last year found that, across 25 countries, an average 70% of consumers claim to buy from brands they believe reflect their own values.
But the Disney vs. DeSantis debate has made clear just how risky it can be for brands to stand up for what they — or what their stakeholders and customer base — believe in. While some PR pros and political strategists think Disney’s condemnation of ‘Don’t Say Gay’ was, if not noble then necessary, others argue that it’s never a worthwhile gamble for corporations to take a stance on such issues.
In any case, it’s too late for Disney. Following today’s House vote, the proposal will now move to DeSantis’ desk — he is expected to sign the bill into law promptly.
If signed, the new legislation will give Disney less authority over its properties and business operations in Florida. It’s likely to lose decision-making power over local police and fire departments as well as environmental protection services and infrastructure needs on its properties. Further, the enactment of the law will almost certainly put the company on the hook for millions more in taxes every year.
What’s more, local taxpayers in Orange and Osceola counties could be made responsible for the special district’s debts — which, per a 2021 financial filing, total nearly $1bn. The enactment of the law could also have a significant impact on the local economy, seeing as Disney employs 60,000-plus Florida workers.
The state’s Republican lawmakers positioned the proposal as a reevaluation of outdated tax laws rather than a repudiation of the corporation for its stance on ‘Don’t Say Gay’. Some of those same lawmakers doubled down on this messaging today. “I think it’s time Disney had to follow the same rules as everyone else,” said Florida Republican state House member Spencer Roach, who represents Lee County. “Disney will finally be put on an even regulatory and taxing playing field with other theme parks.”
The Biden administration came out against the ruling today; White House spokesperson Karine Jean-Pierre reportedly said to journalists: “We oppose the governor taking action against a company because of their opposition to [Florida’s House Bill 1557].”
It remains unclear whether Disney plans to take any legal recourse against DeSantis now that the bill has moved to his desk.