Wealth tax clears house but not Senate
2024 saw several new or amended taxes pass both Houses in the Vermont Legislature. At least three others passed one chamber but not the other. Information republished verbatim from State House Insider, the newsletter of Leonine Public Affairs.
Taxes that passed both House and Senate
- Property tax – A 13.8 percent increase in the average homestead and non-homestead property tax bill compared to the prior year.
- Cloud Tax – A tax on prewritten software accessed remotely estimated to raise $14.7 million for the education fund to buy down property tax rates.
- Short-term rental tax – A three percent surcharge on short-term rentals estimated to raise $11.8 million for the education fund to buy down property tax rates.
- Property Transfer Tax – An increase in the property transfer tax rate on year-round secondary residences without a landlord certificate from 1.25 percent to 3.4 percent and increased exemptions that lower the tax for property used as a principal residence. This is estimated to generate $15.7 million. The revenues are directed towards housing initiatives.
- Securities Fees – Increases to fees on issuers of securities and investment companies, estimated to generate $19.4 million annually mainly directed to the general fund.
- Universal Service Fund (USF) – Repeal of the 2.4% Universal Service Charge for landline, postpaid wireless, and interconnected VoIP consumers and replaces it with a $0.72 monthly charge per access line. The change is expected to raise $7.96 million in total, $3.01 million in new additional annual revenue. USF is used to support E911, the 988 suicide crisis and lifeline and other programs.
Taxes that passed one chamber only
- Corporate tax – The House passed a bill to increase the corporate income tax top marginal tax rate from 8.5 percent to 10 percent of corporate net income attributable to Vermont, estimated to generate $17.7 million annually. The bill also proposed to add back some federal deductions (GILTI and FDII) that would increase reported net income to Vermont for those corporations with those types of income, estimated to raise approximately $15.3 million annually. The funding was to be used to expand Medicaid and invest in the judiciary.
- Personal Income Tax (“the Wealth Tax”) – The House passed a bill to add a new top marginal income tax bracket for tax filers at a rate of 11.75 percent on Vermont taxable income above $410,650 for single filers and $500,000 for married filing jointly filers, for example. This would increase personal income tax revenue by $74.9 million annually. The revenue was to be used for housing initiatives.
- Streaming tax – The Senate passed a bill to tax streaming services at 5 percent of a streaming provider’s gross revenues derived from video streaming services in Vermont. The streaming tax was estimated to raise $6 to $7.6 million in general fund revenue, a portion of which went to the Secretary of State to administer a grant program to fund the operational costs of the 24 Access Management Organizations (AMOs) in Vermont.
Categories: Legislation
Anyone, . . . Democratic, Independents, Progressives, and Republicans in Vermont Legislation who thinks these massive tax increases are good for the citizens of Vermont have been kicked in the head by too many donkeys.
67.61 million dollars taken from the pockets of Vermonters plus 13.8% raise in property tax.
That 13.8% is huge. According to the governments own data:
“In addition to revenue from taxes, such as income, sales and use, and rooms and meals, Vermont is the only state to collect significant revenue from a statewide
property tax. As of January 2023, net revenue from this tax is projected at
$1.296 billion in State fiscal year 2024, making it the largest single source
of State revenue.”
13.8% of 1.296 billion dollars is $178,840,000.
So your State government just took $246.5 million dollars from your pockets Vermonters. That’s almost $400 per man woman and child.
Resources:
https://itep.org/vermont-who-pays-7th-edition/
https://ljfo.vermont.gov/assets/Publications/2023-Fiscal-Facts-Booklet/541265ebf8/Fiscal-Facts-Booklet-2023_FINAL-v3.pdf
Or they could fire half the administrators, a bunch of the teachers, and focus on actual education.
Funny I was just reading this Legislative report (which you think they would have read) from 2023 :
https://legislature.vermont.gov/assets/Legislative-Reports/GENERAL-366459-v2-2023_Report_on_Education_Financing.pdf
and it says exactly that:
“Compared to the national average of 7.45 students per staff member, Vermont’s ratio of 4.4 pupils per staff member was the lowest in the country, followed by Maine at 4.8 in school year 2019-2020. It was also lower than the Northeast average of 6.1 pupils per staff member. According to the Digest of Education Statistic, in 2019, Vermont school districts employed approximately 18,700 staff members. If Vermont had the same pupils per staff as the national average, schools would employ approximately 7,700 fewer staff members. If Vermont had the same pupil to staff ratio as the Northeast average, schools would have employed approximately 5,060 fewer FTE, or a reduction of about 43 staff per school district on average
Say they make $20 an hour (which I would think is low for teachers and principles but maybe a little high for support staff).
$20 x 5060 people x 40 hours a week = $4,048,000 per week that taxpayers aren’t funding or $210,080,000 per year which is almost what they are taxing us.
The real problem with it though is that you can’t fire 5,060 people at once throughout a state of this population without real consequences.
Between the over 50% re-evaluated tax assessment of my home, and the 13% increase in the tax rate, I’d say far more people are going to want some consequences than not. Great information though, and it shows that we can certainly spend taxpayer money better. I taught here in Vermont, by the way, and can definitely attest to a cavalier and entitled attitude toward funding in the school system. They can absolutely do better with less, and will just keep demanding more until we definitively tell them no.
Assuming the existing appraisals are accurate, everyone must keep in mind that when the town lister revalues your home properly, whether or not it increases or decreases in value, your property taxes do not change. The ONLY reason your taxes change is dependent on SPENDING, at the State Education Fund level or at the local Town level.
When politicians tell us that one of the reasons our property taxes are going up is because property values are increasing (e.g., the Common Level of Appraisal – CLA), they are not telling the truth (no surprise there).
Again, assuming the current appraisals are accurate (the fair market value of a home) relative to one another….
The ONLY reason your taxes increase is because SPENDING increases, at the State Education Fund level or at the local Town level. Period!
The big illusion covered with lawfare warfare taxation without representation. The corporation is bankrupt – all the federal pork flowing from the carotid artery of DC is nothing more than vaporized paper and meaningless digits posted to a ledger. Soon the Fed note will not be worth the paper it’s printed on, if not all ready.
Here’s a challenge for folks: try getting $100 bills from your bank. Some are saying the banks are not getting them or giving them – some say you can’t find one printed after 2017. Digital currency ready for launch? Implosion closing in? The big squeeze getting tighter by the day. The real numbers don’t lie – only the installed Legislature and the Admistration.
I’m waiting to see which of those that passed both houses are signed by Scott and will vote accordingly in November….
Stop trying to find ways to steal our money, concentrate instead on the many ways to cut costs. There is too much waste.
I’m assuming that the conservatives don’t want these tax increases…. If by divine intervention the right takes control of the legislature and senate, what will they do with all this newfound money??
I hope that people will do their research on any of the candidates in the upcoming elections!! We will soon find out who will be running and I hope that people will be focused on ALL of the things that are wrong with our current situation and grill these candidates ! We need change !! We need to hold our Senators and Congressperson at the Federal level to task also !! Is anyone really working for us?? THEY NEED A REMINDER !