Democrats urge broader distribution of tax revenues

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(Host) House Democratic leaders have unveiled a tax plan that includes a new revenue sharing proposal for all towns in the state. Republican leaders said they would oppose the measure because it represents additional state spending.

VPR’s Bob Kinzel reports.

(Kinzel) In announcing their plan, the Democrats made it clear that they support half of Governor Jim Douglas’s tax equity proposal – the half that raises roughly $15 million in new revenue by eliminating an exemption on capital gains.

What they don’t support is the way that Douglas wants to spend this money. The governor has proposed a small personal income tax cut. House Democratic leader Gaye Symington says that plan primarily benefits wealthy people. So the Democrats are backing a plan that returns the $15 million to all Vermont towns on a per capita basis.

Symington says individual towns can then decide how to spend this money:

(Symington) “Our towns need help. Our proposal would allow towns to determine the balance between tax cuts and addressing the needs of their communities. We feel it is our communities that can best determine whether to use the funds to reduce a regressive property tax or whether instead to pay for their rising health care insurance costs, replace the roof on the library, repave more miles of road or for example employ youth in summer programs.”

(Kinzel) The head of the Vermont League of Cities and Towns, Steve Jeffrey, enthusiastically supported the plan:

(Jeffrey) “So there are a lot of opportunities that we would have to use that money efficiently. The other nice thing about this is it’s the voters themselves, the taxpayers themselves who are going to be able to choose whether they want to apply it to property tax relief or to meeting some unmet needs that they’ve avoided having to pay for until now.”

(Kinzel) The reaction from Republican leaders was very different. House Ways and Means Chairman Dick Marron said he couldn’t support it:

(Marron) “The more money we raise, the more – I’m sure – there’s an unlimited appetite out there for spending. We already have a high level spending in Vermont. There’s a limit to what we can afford. So I think we need to be mindful of that.”

(Kinzel) If the proposal isn’t included in the final bill drafted by the Ways and Means Committee, House Democrats say they’ll try attach it as an amendment when the governor’s tax bill comes to the House floor for a vote.

For Vermont Public Radio I’m Bob Kinzel in Montpelier.

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