Taxes Matter X: Vermont Edition

New England 2010 008
Creative Commons License photo credit: mrlaugh

Vermont’s Gov. Peter Shumlin (D) admits to Politico.com that their tax system in uncompetitive vis-a-vis New Hampshire.

Vermont Gov. Peter Shumlin, a Democrat with a unified legislature, is rejecting calls from within his party to raise taxes. And he has a Sarah Palin joke to explain why.

“My problem is, on the eastern side of me, I’ve got the state of New Hampshire,” he told POLITICO. “Sarah Palin said that she could do foreign policy because she could see Russia from her house. Well, I’m the first governor in 40 years that can see New Hampshire from my house. So I can do tax policy. And I can tell you, we’ve got no more capacity. They’re killing us.”

New Hampshire has no sales tax and no income tax.

Vermont has a 6 percent sales tax and, at the top tier, a 9 percent income tax. The result has been a long period of stagnation for the Green Mountain State.

“We’ve already got a progressive income tax in Vermont, and we can’t get more progressive because we’ll lose the few payers that we have,” Shumlin said in between sessions at the National Governors Association meeting. “We don’t have any more tax capacity.”