by Guy Page
A Bennington Democrat is the sole sponsor of a bill that would require every municipality to enact a local option tax.
H.802 was sponsored by Rep. James Carroll, introduced into the House on January 16, and assigned to the House Committee on Government Operations and Military Affairs.
This bill proposes to require every city, town, and incorporated village to adopt a one percent local option tax on any combination of sales, meals and rooms, or alcoholic beverages.
At present, state law gives municipalities the option to (with legislative approval) tax some or all of these items. Local option taxes purport to shift the municipal tax burden from residents to non-residents. They are popular in communities with regional shopping malls, such as Williston. Berlin, home to three malls, will vote on an option tax at Town Meeting this year.
A municipality may vote to levy the following 1% local option taxes in addition to state business taxes. Local option tax does not apply to the sale or rental of motor vehicles which are subject to the motor vehicle purchase and use tax.
The state allows the following:
- Local Option Sales Tax: 6% sales tax + 1% = 7% total tax
- Local Option Meals Tax: 9% meals tax + 1% = 10% total tax
- Local Option Alcoholic Beverage Tax: 10% alcohol tax + 1% = 11% total tax
- Local Option Rooms Tax: 9% rooms tax + 1% = 10% total tax
H802, however, would require towns to enact local option taxes – effectively taking the ‘option’ out of local option.
Voters in Bennington, which Carroll represents, rejected local option taxes several years ago.