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Councilors Move To Change City Business Tax

Burlington City Hall Park
Pat Bradley/WAMC
Burlington City Hall

Burlington, Vermont City Councilors approved a resolution this week calling for a change in the city’s charter that would eliminate a business tax.
Burlington and Winooski are the only communities in Chittenden County that collect a commercial personal property tax, or inventory tax. According to the resolution considered by Burlington officials, a National Conference for State Legislatures task force reported in 2016 that type of tax constrains investment and expansion of business.
The sentiment was echoed by Burlington Business Association Executive Director Kelly Devine during the public comment session. She said the tax has discouraged businesses like breweries and manufacturers.  “Because it taxes them more heavily than other types of activities that some of our businesses engage in. It’ll be an important one for helping ensure in the future that our small businesses as well as larger ones are able to continue to thrive and grow in Burlington. Because of the tax in particular is a disincentive for capital investment and more equipment that you need for manufacturing.”

The Charter Change Committee recommended the council adopt the resolution and put the changes before the voters. Committee chair Councilor Joan Shannon says it includes two major changes.  “One is that currently businesses who have less than $45,000 in personal property don’t pay the tax. But businesses that have $45,001 of personal property pay the tax on all of it, not just the $1.  So we have corrected that. And secondly our plan is to remove the personal property tax by July 1, 2026 or repeal it. The language that we have allows us to do it sooner. Also according to our city attorney it would allow us to phase in the implementation of removing the tax.”

Mayor Miro Weinberger said except for parking fees, more concerns have been expressed about this city tax than any other. He believes it is bad policy that has led business to invest outside of Burlington.  “The change that we are proposing here is very consistent with what has been happening in cities and states around the country based on sort of empirical well kind of analyzed policy thinking. And what has been the challenge that has kept us from moving forward is how we accomplish this without putting undue strain on other elements on the city’s budget and on property tax payers. We think the phase out created here really presents a path forward where we can move away from this problematic tax that is bad for Burlington that is bad for Burlington property payers and detracts from our overall financial strength.”  

City councilors voted unanimously to move the charter change forward to public hearings in January.

Audio is courtesy of the live webstream provided by Channel 17 Town Meeting Television.

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