A group of Democratic lawmakers is asking the Vermont Department of Taxes to determine whether it can exempt feminine hygiene products from the state’s sales tax.
In a letter last week to Vermont’s acting tax commissioner, Craig Bolio, legislators asked the department to see whether menstrual products including tampons, sanitary pads and menstrual cups, could fall under existing tax exemptions.
However, Bolio said changing the regulations could put the state out of compliance with a multi-state tax agreement.
Under current law, the department doesn’t impose sales taxes on some medical supplies like diapers and bandages. The lawmakers are asking the department whether the exemption could apply to feminine hygiene products.
“These products are also necessary for the health of women and girls,” the five Democrats wrote in their letter.
“They are not merely ‘hygienic’ products. Women and girls risk infection and other maladies if non-sanitary products (or no products) are used to absorb menstrual blood.”
In Vermont, feminine hygiene products are subject to a 6% sales tax, and in some communities a 1% local option tax.
Rep. George Till, D-Jericho, proposed a bill this year that would eliminate the sales tax on menstrual products. The bill didn’t make it out of committee in 2019. But Till, who signed the letter, recently learned that making the change may not require legislative action.
“Somebody had the idea that potentially we didn’t need a bill,” Till said.
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“Maybe this actually falls under the current exemptions to the sales tax and, if that were the case, we could get the Tax Department to change it without having to pass the bill,” he said.
In the letter, the lawmakers said the department should also look into whether the sales tax exemption for clothing could also apply to feminine hygiene products.
“They have this power to make these kinds of distinctions, and we’re saying, I think you should treat menstrual products the same way,” said Sen. Chris Pearson, P/D Chittenden, who signed onto last week’s letter.
Senate Health and Welfare Chair Sen. Ginny Lyons, D-Chittenden, and Reps. Lori Houghton, D-Essex Junction, and Jessica Brumsted, D-Shelburne, also signed the letter.
While he is still researching the issue, Bolio said it’s likely he will recommend against the department taking action, and suggest lawmakers pass legislation if they want to exempt feminine hygiene products from taxation.
Bolio said that Vermont is part of a 24-state “Streamlined Sales Tax” agreement and under the agreement, states use standardized definitions for taxable products.
The purpose of the multi-state system is to help ease the burden of tax compliance for corporations who do business in multiple states.
Under the agreement, feminine hygiene products stand alone as their own class of taxable products.
Bolio said that if the department was to reclassify them as medical supplies or clothing, the state would likely fall out of compliance with the multi-state agreement and be at risk of being sanctioned or removed from it.
“I don’t know what kind of negative impacts that can have, but it’s best for us to remain in accordance for that,” Bolio said.
He said that the agreement is important because it “provides ease of compliance for taxpayers, which helps make sure folks are collecting and remitting appropriate sales tax to Vermont.”
However, he said there would be no issue if legislators decided to exempt the products by law, which wouldn’t involve changing how they are defined.
“I think by far the easiest path on this is to create a statutory exemption,” Bolio said.
Gov. Phil Scott’s spokesperson, Rebecca Kelley, said that the governor “is always open to a discussion on providing tax relief to Vermonters” and that he would be willing to discuss legislation exempting menstrual products from the sales tax.
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Nine states have moved to exempt feminine hygiene products from the sales tax, according to the Tax Foundation. Connecticut, New York and Illinois, have all passed legislation to do so.
Brumsted, a sponsor of the bill supporting the exemption, said removing the sales tax for feminine hygiene products could make them more accessible for low income women.
She said a recent study by a University of Vermont medical student found people polled at the Winooski Food Shelf listed sanitary products as a necessity they found hard to afford.
“No one thinks about the sanitary products for folks — that they absolutely need,” Brumsted said. “But how do you help folks make sure that those are available?”
Brumsted said lawmakers should move ahead if the Tax Department doesn’t act on its own.
“It’s unfortunate that we couldn’t just figure it out inside of our current statutes,” she said, adding “but I don’t think it’s the end of the world to work through legislation either.”
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