Small Business Owners Say $140 Million in Taxes Will Damage Economy

National Federation of Independent Business (NFIB)

The National Federation of Independent Business (NFIB) today said that a big tax package approved by recently by the House will hit consumers in the wallet and hurt small businesses in Vermont.

“We can’t keep doing this,” said NFIB state Director Shawn Shouldice. “The Governor said earlier this year that he saw no need for tax increases. He acknowledged in the past that Vermont has reached its tax capacity and is risking its competitiveness with high taxes. And here we are again debating whether to pick more money out of the pockets of Vermonters who can least afford to pay them.”

The $30 Million tax package passed by the House would expand the sales tax to include all clothing (more than $110), candy, soda, bottled water and dietary supplements. It would increase the sales tax on tobacco products, increase the levy on meals and vending machine purchases and implement the “Cloud Tax”.

“We share a border with New Hampshire where there is no sales tax,” said Shouldice. “Why would we give Vermonters more reasons to leave the state to buy what they want?”

The House plan would also reduce the number of income tax deductions for so-called high earners and consolidate the two highest brackets into the top rate.

“The income tax is a small business tax,” said Shouldice. “That’s the way that most Vermont small businesses pay their taxes. So raising the income tax will hurt the small businesses that are in the best position to create new jobs and make investments in our economy.”

Backers of the tax package say it’s necessary to make up for reductions in federal spending.

This package of taxes comes on the heels of $50 million increase in the statewide property tax, a $49 million increase in the gas tax and the continuation of the $9 million Catamount Employer Assessment.

“Every small business and every household in Vermont has had to prioritize and make adjustments during this recession,” she said. “The downside to Vermont’s overreliance on federal dollars is rearing its ugly head, our elected officials can’t keep doing what they are doing they must start thinking outside the box.” Montpelier has acknowledged that next year’s fiscal situation will be similar.

For more information about NFIB, please visit www.nfib.com.