This commentary is by Dan Jones, who has worked for many years on sustainability and resilience in Montpelier and was the founder and director of the Sustainable Montpelier Coalition.
Recently, I received an interesting lesson on how privileged Vermonters will use our state’s protective tax laws to shield themselves when I got into a conversation with a woman who is a member of what I will call the “well-to-do” class.
“This whole idea of taxing second homes more to pay for health insurance is stupid,” she said. “If you have a home here and live in another state, it’s easy to get around this. All my husband and I have to do is register our home in Florida as his primary residence and our home here as mine. We are protected from this higher tax rate, and no one can do anything about it.”
I protested, “But the whole idea is to give all Vermonters primary healthcare and lower all our health insurance costs. What is so wrong with that? Why shouldn’t those with greater wealth help pay their fair share?”
“Most people you are talking about are on Medicaid and just game the system to get more extra care,” she said. “They use the system to get cheap drugs. We don’t need any more of these healthcare scams.”
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The exchange left me wondering how we will manage in an increasingly threatening future. It seems that at least one person who can support houses in Florida and Vermont finds a proposal to provide for the larger social good an imposition to be gamed away. Our government and tax systems have been supporting such privileged selfishness for too long.
Rather than protecting Vermonters from the threat of deteriorating affordability, Gov. Phil Scott has opposed efforts to raise taxes on Vermont’s highest earners, arguing a wealth tax would drive well-to-do residents out of the state. He has resisted broader property tax increases, framing them as a burden ordinary Vermonters can’t afford.
Now I don’t know about you, but as I watch the South become insufferably hot and the West burn up, Vermont’s moderate climate looks more and more attractive. I’m pretty sure that, even with increased taxes, our well-to-do property owners won’t be going anywhere as the larger climate collapses. The arguments against fairer taxation seem to me to be part of current Vermont policy to protect the privileged.
Without big changes to tax laws and political will to support the public good, such reasonable innovations as universal basic healthcare will be impossible to create. Instead, Vermont’s citizens will have to anticipate ever higher taxes and insurance costs just to keep things in place.
While I’m not a tax expert, it is clear there are several loopholes for evading taxes, such as the example I mentioned above. We could tighten the tax laws that now allow different marriage partners to own different properties and trick the tax authorities, and authorize ways of seeing through such dodges. If one partner claims Vermont residence, then the couple’s total income should be subject to Vermont income taxes. Oh, and let’s make our income taxes truly progressive on incomes over $500,000 per year.
The simple fact is that privileged property owners have protections built into Vermont’s tax laws. This has to change, or the rest of us will see our futures eroded by constant inflation, failing healthcare systems and lost prospects of future prosperity.
The privileged have been protected for way too long. They have sucked up the resources the rest of us need and taken more from our state than they should. It is time for them to pay their fair share.
