On May 22, 2024

Vermont’s outsize appetite for taxes

Dear Editor,

Most Vermont taxpayers have just experienced a period of tax focus, specifically property taxes to support our public schools. Some communities are still going through the valuable public debate about property taxes and, more generally, the overall tax burden and trying to evaluate that relative to what we receive for our tax dollars.

Vermont is a small state both geographically and by population.  According to USA Today (2022), Vermont ranks 43rd in size by geographical area. According to Britannica.com, it ranks 49th in population (2023). Therefore, we are the second smallest state by population.

Conversely, when it comes to taxes, Vermont ranks among the top 10 states in terms of tax burden. Here are some data points:

Intuit Turbotax ranks Vermont 8th in the top 10 highest income tax rates for 2023 with an 8.75% rate on individual incomes over $204,000 and joint incomes over $243,750.

According to WalletHub.com  and CPA PracticeAdvisor, Vermont comes in with the 3rd highest overall tax rate of all states with a total tax burden of 11.2% made up of a property tax burden of 4.85% (No. 2), an individual income tax burden of 3.09% (No. 11) and a sales and excise tax burden of 3.18% (No. 27).

For the year 2022, the Tax Foundation ranked Vermont as the 4th highest in the nation for total state and local tax burden at 13.6%.

We can quibble about the precise numbers and rankings. However, the trend is clear: this tiny state has an outsize appetite for taxes.

Please remember this information the next time your Legislature or local community comes knocking for more taxes.

Max Tyler, Underhill

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