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Income Tax vs. Property Tax

Burlington, Vermont - August 21, 2007

Finding a better way to pay for schools is a constant challenge for Vermont lawmakers. Some say relying mainly on the property tax is just not a fair way pay for education. They say its time to look at the income tax.

"I think we owe it to the people of Vermont to take a serious look at this issue," said Representative Jim Condon, D-Colchester.

Property taxes have been on the rise for years and some feel that property is not a good measure of wealth.

Representative Jim Condon is one of five lawmakers from the House Ways and Means committee interested in looking at an income tax to help fund education.

"For many of them, they'd be a lot better off," said Rep. Condon.

The details have not been worked out just yet.  But so far, the idea is replace the education property tax with an education income tax. Vermont residents would pay a base tax rate of 1.9 percent on top of the current income tax rate. That number would later be adjusted after the town's per pupil spending is determined.

"Then those people who maybe have smaller incomes but valuable properties, properties that have increased in value over the years through various assessments, they'd make out and be paying less taxes over all," Rep. Condon said.

"It's a terrible idea," said Governor Jim Douglas, R-Vermont.

"There aren't enough wealthy people in Vermont to tax in order to pay for public education, this would be a tax on middle class, and we have the most heavily taxed people in the country, we don't need to make it any worse," said Douglas.

So how do Vermonters feel about the idea?

"I don't pay property tax now, so I would have to start paying an income tax to support schools, I have a son now so I can understand that but he's in school," said Krista Smith of Colchester.

"I think something needs to be done, I think something needs to be done about the property tax, but I don't know, it's up to the legislature I guess," said Randy Regimal, of Burlington.

Most folks we spoke with say it's just too early in the game to decide if they are for or against an income tax and want to hear more about the details. The House Ways and Means Committee is scheduled to meet again to talk about this very issue next month. Members of the education and business communities will also be invited to participate in the discussion. That date has not been set yet.

Beth Parent-WCAX News