Traditionally our Legislature estimates what tax revenues might
be and then devises a budget. If a household operated like
that, here's what it would look like: Mom and Dad would take
over 90% of the income off the table before deciding how to keep
the family afloat.
The final state budget might be $14 billion. Let's add in the
cost for a universal health care plan for all Vermonters, $6
billion. Vermont tax rates run from 3.6% to 9.5%. State data (line
28) shows the total Vermont Adjusted Gross Income for 2011
(in-state returns only) is $16.35 trillion.
However, 3.6 percent of $16.35 trillion is $588.6 billion, 29
times our hypothetical state budget and 1,000 times greater than
the 2011 net tax revenue of $538 million.
Assuming that a $20 billion budget would cover everything, do
the math: $20 billion is twelve-hundredths of one percent of
$16.35 trillion. So, why are we paying a tax rate almost 3,000
times greater, yet stiffing the needs of Vermonters (e.g., the
daycare/Earned Income Credit shell game?)
Rather than planning budget via Blind Man's Bluff, the Governor
and the Legislature should aim for the stars - identify what it
takes to keep Vermont the best state in the nation, figure out the
price and then devise an equitable tax system to make it
happen. This is at the heart of what our Vermont Workers
Center "Put People First" campaign is all about.
Chuck Gregory, Springfield, Vt.