Editorial: Vermont's property taxes are high, but far from the highest
Doug Hoffer’s penchant for accuracy when talking about state policy is one reason he would be an outstanding state auditor. For too long misleading comments and positions by our state leaders have gone unchallenged and have been allowed to take root in the state’s psyche. The misperception around the state’s tax rankings is one area in which the Douglas administration — and now lieutenant governor candidate Brian Dubie — has distorted the facts and reality.
Last week, Hoffer corrected Dubie’s claim that Vermont had the highest rates in the country with a thorough explanation citing the various tax rates within the state compared to our neighboring states. While it’s true that Vermont has one of the highest marginal tax rates for residents, that rate only applies to the top 1 percent of taxpayers, and even then the rate doesn’t apply until the first dollar over $372,951 earned annually. (Maine and Massachusetts, for example, both have higher taxes for household incomes of under $109,320, and Maine’s taxes are still higher than Vermont’s for those earning in the million-dollar range.) The tax rates for those in the low to middle-income ranges (up to $125,000 and more for a family) are actually lower than other states in the Northeast. And since 90 percent or so of Vermonters fall within that income range, it is grossly misleading to have Vermonters think they are paying the highest taxes among the neighboring states. It is simply not true.
Dubie knows this, but claiming that Vermont’s taxes are the highest only for those making more than half-a-million or more, just doesn’t have the same populist appeal, does it?
This week Hoffer again corrects a blatant distortion Dubie makes when he claims “Vermonters have the highest property taxes in the country.”
“First, Mr. Dubie is undoubtedly referring to Census data for state level property taxes. As has been reported many times (and as Mr. Dubie well knows), Vermont is the only state in the country that has shifted education costs to a statewide property tax. As a result, statewide comparisons for this particular measure are meaningless.
“When we look at state and local per capita property taxes, Vermont ranks seventh (not first as Dubie claims) behind N.J., Wy., Conn., N.H., N.Y. and R.I.
“But there is a fundamental problem with these figures (as they) do not account for the amount of property taxes paid by non-residents, which is an important consideration in a state ranked second in percentage of vacation homes. In 2007, the Joint Fiscal Office estimated that Vermont exported approximately $244 million in property taxes paid for second homes and commercial properties by non-residents. If this is subtracted from the Census figure, Vermont drops down to 16th – quite a different story than ‘the highest in the country.’”
Hoffer’s point is not that Vermont’s taxes are not high. As any honest politician will admit that Vermont’s taxes will always be higher than the national average because we have a small population equal to a medium-sized city funding a statewide system of roads and bridges with rural schools scattered throughout. Rather, his point is straightforward. “Important policy debates should be based on relevant facts, not figures intended to mislead.”
Unless Dubie’s intention is to mislead, he should change his rhetoric to include the complete story in his campaign stops, on his web site and in his mailings to the public. If he doesn’t, voters should question the candidate’s integrity and his willingness to be forthright with voters.
In this role, Hoffer should be equally diligent in pointing out misleading statements on both sides of the political aisle as they arise. He has the knowledge to help keep the policy debates focused on solutions using the relevant facts and he apparently has the political will to help the public truly understand the issues. That’s a most welcome development Vermont voters should recognize.
Angelo S. Lynn