Tuesday, January 23, 2024
Vermont Becomes Latest State to Propose Wealth Taxes
Vermont lawmakers are proposing new legislation to impose taxes on the state's wealthiest residents, aligning with a national campaign led by Democrats to address post-pandemic budget challenges. One proposal targets individuals with more than $10 million in net worth, taxing their unrealized capital gains. Another suggests a 3 percent marginal tax on individual incomes exceeding $500,000 annually. These measures, sponsored by State Representative Emilie Kornheiser, aim to alleviate the tax burden on the middle class and generate revenue, with supporters estimating a potential $98 million influx into the state's budget. The initiative is part of a broader Tax Justice Initiative, echoing Senator Elizabeth Warren's federal wealth tax proposal and gaining momentum as several states consider similar measures.
The campaign faces challenges in states like California, where Governor Gavin Newsom rejected the idea of a wealth tax to address a budget deficit. In Vermont, the legislature is under Democratic control, but Governor Phil Scott, a moderate Republican, remains cautious about taxing the wealthy further. However, the push for wealth tax is fueled by public frustration over perceived inequalities in the tax system, with a significant majority expressing concern that the wealthiest individuals aren't paying their fair share. Over 250 billionaires and millionaires have even advocated for increased taxation on the wealthy. As of 2024, lawmakers in 10 states, including California, Connecticut, New York, and Vermont, have introduced or are working on wealth-tax bills.
For more information see David W. Chen “Vermont Becomes Latest State to Propose Wealth Taxes”, The New York Times, January 23, 2024.
Special thanks to Lewis Saret (Attorney, Washington, D.C.) for bringing this article to my attention.
https://lawprofessors.typepad.com/trusts_estates_prof/2024/01/vermont-becomes-latest-state-to-propose-wealth-taxes.html