MONTPELIER – Second homeowners taking refuge from COVID-19 are likely to trigger a surge in tax receipts next year thanks to a little-noticed provision in Act 92, the emergency law which went into effect last week, according to Vermont Tax Commissioner Craig Bolio. “We will be aggressively enforcing the new provision defining residency for the purpose of the income tax,” he announced during a Zoom press conference yesterday, “and we expect to see a significant increase in tax receipts.” The law, which modifies the requirement to file from either being domiciled in Vermont or owning a home and spending 183 days or more, adds a third factor: whether or not you are in residence during mud season.
Representative Heidi Scheuermann of Stowe (R-Lamoile), who originally offered the clause, explained “Typically during mud season I drive around Stowe and it’s a ghost town. Very few cars, nobody in the stores, no snow on the ground, just mud. But now it’s different. Sure, people are not in the stores, there isn’t much driving around, but just about every home has two SUVs with New York, Connecticut, or Massachusetts plates. Not only that, based on how slow my StoweAccess service gets at 10am, I realize that there must be thousands of Zoom meetings going on. If you had asked me six months ago who lives in Vermont during mud season, I’d say only Vermonters. So these folks are one with us now and its time to get them paying income taxes.”
Randall Szott of Barnard (DP-Windsor), the only legislator to vote against the provision, criticized the move as a Republican power grab. “Sure, make these so-called flatlanders taxpayers and voters, they are probably going to vote Republican. This is a threat to Democrats, Progressives, and Democrat-Progressives throughout the state. It’s also not well thought out. Making second homeowners who have taken refuge pay income tax will turn them into residents for the purpose of the school taxes. A lot of those towns have lower resident rates than non-resident rates.”
Historically, Vermont has not tried to collect income tax from second home owners who spent less than 6 months in Vermont, instead focusing on preventing Vermonters from trying to claim residence elsewhere despite considering their Vermont property their true home, the so-called domiciling provisions. With the pandemic creating an entirely new class of residency, state leadership decided to quietly go along with the provision and buried it in legislation purporting to deal with open meeting law and election procedures. “Sure, there will probably be court challenges,” said one member of the administration who asked not to be identified because many of his hunting pals are from more level parts of the country, “but in the meantime the quarterly payments due will be helpful to state cash flow in July and October this year.”
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