Taxes and the cost of living rank high in Vermonters’ concerns this election season, according to what people shared with Vermont Public.
Overall inflation, transportation, health care bills, and housing are among the costs putting pressure on Vermonters’ wallets.
If you’re evaluating Vermont political candidates this year based on their approaches to the economy, here are some places to start.
Jump to a section:
- The basics
- Changes the Legislature and governor have made recently
- How does your vote matter?
- What the candidates are saying this year
Let's walk through it together. This guide tells you how voting can impact Vermont's taxes and affordability. Or explore another top issue:
The basics
Four out of 10 Vermonters say they struggled “a lot” or “somewhat” to afford basic necessities in the last year, according to a recent poll from the University of New Hampshire Survey Center. The poll found that Republicans were more likely to say their personal financial situation was declining and to have a gloomier outlook on future prospects for themselves and Vermont businesses.
Compared to other states, Vermont has high personal income, corporate income, and property taxes. Sales taxes are in the middle of the pack.
One way experts measure taxes across states is by dividing total tax revenue by the number of people. In fiscal year 2021, Vermont collected the seventh-most revenue per capita in the country.
Compared to other states, Vermont spends a relatively high amount on assistance for people in need: In 2021, Vermont ranked ninth in the nation for welfare spending per capita.
Since the pandemic, Vermont has experienced inflation just like the rest of the country, and it’s blunted some of the wage gains made in the past couple of years.
Looking just at wages, the average wage has increased 22.4% since 2019. But after adjusting for inflation, wages increased just under 4%.
Vermont’s economy is also characterized by:
- An aging population.
- Low unemployment.
- A variety of industries.
More: Vermont leads the nation in median household income gains
Changes the Legislature and governor have made recently
Legislators in recent years have tried to make up for the rising cost of programs in a time when federal pandemic aid is drying up. Here are a few of the decisions that have affected Vermonters’ finances:
Property tax bill: Each year the Legislature passes a bill to pay for school budgets that have been approved by local communities across the state. This year, increased spending led to a significant rise in property taxes. Lawmakers used a new 3% tax on short-term rentals, and removing the sales tax exemption for software access remotely, to mitigate some of the increase. The governor had vetoed the bill, arguing that the state should buy down tax rates even more by using one-time money such as zeroing out the education fund’s stabilization reserve. Lawmakers overrode the veto.
Vermont Saves retirement plan: The state is setting up a Roth IRA retirement plan for Vermonters who don’t have access to one through an employer. People will be automatically enrolled in the program once it’s operational. The Legislature and governor passed this law in 2023.
Second home purchase tax: This year the Legislature increased the property transfer tax on second home purchases, while giving buyers of primary homes a modest property transfer tax break. Some of the new revenue is earmarked for eviction prevention programs.
Expanded child care subsidies, funded by payroll tax: Last year, the Legislature overrode Gov. Scott’s veto to pass a landmark child care bill that expanded subsidies for families and increased payments for child care providers. This work is funded by a new 0.44% payroll tax.
Attempting to tamp down increases in prescription drug costs: Lawmakers asked the Green Mountain Care Board to come up with a plan for regulating prescription drug costs in Vermont. Regulators here are watching closely as the Biden administration’s negotiated Medicare drug prices take effect.
More from Vermont Public: Does Vermont tax Social Security benefits? It's complicated
How does your vote matter?
To understand how your vote affects state taxes and the cost of living, consider a few ways that elected state officials can act on the issue:
- Changing income tax brackets and tax credits
- Changing the mix of property taxes and other taxes that pay for education, or attempting to get school districts to spend less overall
- Setting a minimum wage
- Bolstering subsidies for things like child care and housing
- Encouraging certain types of businesses through tax credits and incentive programs
- Cutting tax rates and associated state programs
- Creating new taxes; for example, by legalizing and taxing sports betting and cannabis
Decide what matters most to you, and scrutinize candidates through that lens.
If they propose new financial assistance programs for Vermonters who are struggling, does it have a sustainable funding source?
If they make big promises about cutting taxes, do they also describe how they would make up for the revenue loss in the state budget?
If they’re raising taxes, can they make the case that the government can do more good with the money than if it had stayed with the people they’re collecting it from? (This is a constitutional requirement!)
More: The constitutional arguments for — and against — tax increases in Vermont
What candidates are saying this year
“Vermont needs to be ‘affordable’ for everyone, not just low income Vermonters. We need to make it easier to get housing, have reliable transportation, heat your home, find child care, and buy groceries. Reducing government regulations in all these areas will help.” - Marty Feltus, Republican candidate for House, Caledonia-3
“As Senate President Pro Tem, I've tried my best to make sure that we're sensitive to cost burdens over which we have little control. Last year I made the decision to let some high-profile bills die that would have raised the tax burden significantly.” - Phil Baruth, Democratic/Progressive candidate for Senate, Chittenden-Central district
“We are living in a time of extreme wealth inequality and the needs of working families are not being met, even with rising pay. To make sure we can pay for essential services like healthcare and education I do support shifting the tax burden on to wealthier Vermonters.” - Mike McCarthy, Democratic candidate for House, Franklin-3
“My administration would advocate for comprehensive education reform that balances fiscal responsibility with the need to provide quality education. This would include exploring more efficient use of resources, increasing state investment in education, and considering new revenue sources like wealth taxes.” - Esther Charlestin, Democratic candidate for governor
“We have the second highest spending per pupil in the nation, so we need to do things a little bit different. We need to grow the workforce. We need more kids, or we need to consolidate, and we have to get a handle on some of the expenses throughout.” - Phil Scott, Republican candidate for governor
Find more candidate responses to questions about housing, taxes and affordability, climate and environment, health care and education in Vermont Public's candidate guide and debates.
How to vote in the general election
Eligible voters can register anytime up to and on Election Day, Nov. 5.
You can register online, in-person at your town clerk’s office, or on Election Day at your polling place.
Voting
If you received a ballot in the mail, you can return it by mail or take it to your town’s dropbox.
You can also vote early, in-person at your town clerk’s office or on Election Day at your polling place.
If you get a mail-in ballot but plan to vote in person, bring the ballot with you to your polling place.
Learn more
Find your registration status, ballot information, polling place info and more at your My Voter Page.
Get more information about the voting process in Vermont Public’s general election guide, and learn about who’s running in our candidate questionnaire.
This story is part of Vermont Public’s Citizens Agenda approach to election coverage. We’re asking a simple question: What do you want the candidates to be discussing as they compete for your votes? Front Porch Forum is our lead outreach partner for this project.
Have questions, comments or tips? Send us a message.