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Old 05-29-2015, 07:02 PM
 
Location: Inis Fada
16,833 posts, read 29,119,271 times
Reputation: 7397

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One thing which hasn't been taken into account is second (or third, etc...) homeowners. While they may live out of state and not pay income taxes to Vermont, they are still paying property taxes and school taxes. They're not using the schools, probably make minimal demand upon the town/county/state services the property taxes are going toward. They're not receiving income sensitivity and are paying a higher rate. So that guy with the Vermont leaf season pied-a-terre (and 6 other houses) is paying far more in property/school tax than the local person with one home.

It's highly likely people like e-commerce 7 house man hire local people to maintain the property, clean the houses, build or renovate, etc. Tax him out and there goes some local jobs.
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Old 05-30-2015, 06:45 AM
 
809 posts, read 678,128 times
Reputation: 1333
Relative to the Vermont income tax, property and school taxes pale in comparison to the tax revenue generated by a Vermonter who lives in the community, provides stimulus to the economy through his/her productivity, thereby generating more sales, income, corporate, etc. taxes. The multiplier effect in a healthy economy far outweighs the property tax paid on a bauble owned by someone who is into conspicuous consumption. I say, if you want to flaunt it, I'll be happy to make sure you're flaunting something worth the flaunt.
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Old 05-30-2015, 11:21 AM
 
Location: Inis Fada
16,833 posts, read 29,119,271 times
Reputation: 7397
Quote:
Originally Posted by cgregor View Post
Relative to the Vermont income tax, property and school taxes pale in comparison to the tax revenue generated by a Vermonter who lives in the community, provides stimulus to the economy through his/her productivity, thereby generating more sales, income, corporate, etc. taxes. The multiplier effect in a healthy economy far outweighs the property tax paid on a bauble owned by someone who is into conspicuous consumption. I say, if you want to flaunt it, I'll be happy to make sure you're flaunting something worth the flaunt.
Conversely, there are resident takers in the system who benefit by those who pay taxes on "baubles" but do not utilize the schools, police, etc. to the extent the takers do. If you were to eliminate the "bauble" owners there would be a decrease in people utilizing service industries, hospitality industries, entertainment, etc. Less demand = fewer jobs. Fewer jobs are not the keystone of the healthy economy.

Replacing the "bauble" owners with residents means greater demands on services such as schools -- more children, more teachers, more salaries and benefits, increased taxes to pay for it.

Periodically, there are threads indicating how expensive it is to live here and how the climate is unfriendly to business. I recall a while back reading a sentence about how real Vermonters can't afford costly maple syrup. It might have been an exaggeration on the writer's part, but it stuck with me. The cost of living in Vermont to someone just scraping by is visible to anyone driving around: weary homes in need of repairs, mobile homes that have seen better days, debris in the yard, cars which have been kept on the road with homemade repairs, food shelves. Then there are empty storefronts, dollar stores, 2nd hand stores. These are things which collectively indicate a community with economic concerns.

People moving to a new residence take costs into consideration. Price of a house and property/school taxes are the first things they have to decide whether or not they can afford. No one buys a house without looking into the tax burden. I've read a number of threads in which property/school taxes are labeled high or expensive in relation to one's income. While not as opaque, tenants are subject to these taxes in their rent, and people rent based on their budget, like homeowners budgeting a home mortgage payment.

I wonder if there are figures for the number of non resident property owners paying property/school taxes (but not subject to income tax) and the percentage of those taxes overall they comprise statewide? I haven't any idea and am curious to know. According to a Times Argus article in March 2015, 65-70% of households receive income sensitivity . So 65-70% of households in Vermont are earning below the $109K threshold. That's pretty eye-opening.
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Old 05-30-2015, 02:56 PM
 
Location: The Woods
16,955 posts, read 22,271,168 times
Reputation: 9066
If any group should be targeted for revenue in VT, it's the ski resorts operating on state lands at giveaway lease rates from the 60's or something. They shoulder a large part of the responsibility for the rising housing prices in the state, reap large profits, and often don't even hire locals. They should be charged market rates for the leases, and required as part of the leases to hire Vermont residents for all positions at better wages.

What we really need is a more diversified economy that provides jobs that pay people enough to live on. It's an insult to ask educated people to work unskilled labor jobs for barely over min. wage, or worse, a job that requires that education for $10 an hour. That's why people leave Vermont.
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Old 05-31-2015, 06:56 AM
 
Location: Chicago, IL
545 posts, read 631,785 times
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Quote:
Originally Posted by arctichomesteader View Post
It's an insult to ask educated people to work unskilled labor jobs for barely over min. wage, or worse, a job that requires that education for $10 an hour. That's why people leave Vermont.
This is exactly what happened to us. It was really frustrating, sad, and hard, because we had wonderful friends in Vermont and loved so much about being there. But we finally could not stand it anymore and we did choose to leave.
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Old 05-31-2015, 01:25 PM
 
13,913 posts, read 7,405,593 times
Reputation: 25408
Quote:
Originally Posted by arctichomesteader View Post
If any group should be targeted for revenue in VT, it's the ski resorts operating on state lands at giveaway lease rates from the 60's or something. They shoulder a large part of the responsibility for the rising housing prices in the state, reap large profits, and often don't even hire locals. They should be charged market rates for the leases, and required as part of the leases to hire Vermont residents for all positions at better wages.

What we really need is a more diversified economy that provides jobs that pay people enough to live on. It's an insult to ask educated people to work unskilled labor jobs for barely over min. wage, or worse, a job that requires that education for $10 an hour. That's why people leave Vermont.
The typical ski resort lease is 5% of gross ticket sales and 2 1/2% of all other sales (lodging, food, alcohol, retail). That is on top of the sales tax already collected on those sales. Virtually all the real estate at ski resorts is taxed at the Act 68 commercial rate with none of the residential exemptions most Vermonters enjoy. All the resort towns are donor towns and virtually all of that money gets redistributed. In addition, all the businesses in town pay the very stiff Vermont corporate income tax. Most resorts have a ton of telecommuting residents who are paying Vermont's top brackets for state income tax.

I think you have a very uninformed opinion about "profit" and the ski business. The largest ski resort in the state only does about $50 million in sales. They have enormous energy costs to make snow. They have enormous labor costs. Other than Stowe, they're all purchased with borrowed money so they have interest to pay in staggering amounts. The state only does 4.1 skier visits. That's maybe $250 million in sales. There simply ain't that much profit.

If you want to kill the goose that lays the golden eggs, by all means force all the ski resorts to hire Vermonters at $25/hour with full benefits and jack up their lease percentages. While you're at it, why don't you start making GlobalFoundries pay corporate income tax and property tax? That's another evil out of state corporation that needs to be targeted.

And it's the ski resort's fault that real estate is unaffordable in resort towns? Now I've heard it all. Is it Champ, the Lake Champlain sea monster's fault that lakefront property is unaffordable? Must be. It couldn't possibly be that lakefront property is scarce and in high demand so it costs more.
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Old 05-31-2015, 01:32 PM
 
13,913 posts, read 7,405,593 times
Reputation: 25408
Quote:
Originally Posted by cgregor View Post
Relative to the Vermont income tax, property and school taxes pale in comparison to the tax revenue generated by a Vermonter who lives in the community, provides stimulus to the economy through his/her productivity, thereby generating more sales, income, corporate, etc. taxes. The multiplier effect in a healthy economy far outweighs the property tax paid on a bauble owned by someone who is into conspicuous consumption. I say, if you want to flaunt it, I'll be happy to make sure you're flaunting something worth the flaunt.
This is why keeping GlobalFoundries in place in Essex Junction is so critical to the viability of the state. 5,000 tech jobs in a state of 630,000 is an enormous concentration. Like everywhere else, those jobs provide a 10x multiplier to the local economy. You don't have a viable economy when towns, health care, and state colleges are your dominant employers.
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Old 05-31-2015, 07:04 PM
 
Location: The Woods
16,955 posts, read 22,271,168 times
Reputation: 9066
Quote:
Originally Posted by GeoffD View Post
The typical ski resort lease is 5% of gross ticket sales and 2 1/2% of all other sales (lodging, food, alcohol, retail). That is on top of the sales tax already collected on those sales. Virtually all the real estate at ski resorts is taxed at the Act 68 commercial rate with none of the residential exemptions most Vermonters enjoy. All the resort towns are donor towns and virtually all of that money gets redistributed. In addition, all the businesses in town pay the very stiff Vermont corporate income tax. Most resorts have a ton of telecommuting residents who are paying Vermont's top brackets for state income tax.

I think you have a very uninformed opinion about "profit" and the ski business. The largest ski resort in the state only does about $50 million in sales. They have enormous energy costs to make snow. They have enormous labor costs. Other than Stowe, they're all purchased with borrowed money so they have interest to pay in staggering amounts. The state only does 4.1 skier visits. That's maybe $250 million in sales. There simply ain't that much profit.

If you want to kill the goose that lays the golden eggs, by all means force all the ski resorts to hire Vermonters at $25/hour with full benefits and jack up their lease percentages. While you're at it, why don't you start making GlobalFoundries pay corporate income tax and property tax? That's another evil out of state corporation that needs to be targeted.

And it's the ski resort's fault that real estate is unaffordable in resort towns? Now I've heard it all. Is it Champ, the Lake Champlain sea monster's fault that lakefront property is unaffordable? Must be. It couldn't possibly be that lakefront property is scarce and in high demand so it costs more.
"Only 50 million" yet they have to bring in foreign wage slaves to work for them? That's just greed and the taxpayers of this state are subsidizing their profits with a cheap lease of public lands. They're paying less than the average individual in taxes as a percent of their income, not hiring locals or if they do hire them at wage slave rates, and causing real estate to become out of reach of the average local. Yes the resorts are responsible for real estate becoming unaffordable. No one even hardly wanted land in places like Killington, Plymouth, etc., years ago. They were cheap, affordable places for the locals. The resorts changed that and the damage they do to locals outweighs the benefits they bring.
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Old 06-01-2015, 03:59 AM
 
Location: Vermont
1,018 posts, read 1,420,987 times
Reputation: 1994
Quote:
Originally Posted by arctichomesteader View Post
"Only 50 million" yet they have to bring in foreign wage slaves to work for them? That's just greed and the taxpayers of this state are subsidizing their profits with a cheap lease of public lands. They're paying less than the average individual in taxes as a percent of their income, not hiring locals or if they do hire them at wage slave rates, and causing real estate to become out of reach of the average local. Yes the resorts are responsible for real estate becoming unaffordable. No one even hardly wanted land in places like Killington, Plymouth, etc., years ago. They were cheap, affordable places for the locals. The resorts changed that and the damage they do to locals outweighs the benefits they bring.
My Dad was a meter reader for CVPS (now GMP) back in the 60's. I remember him coming home and telling my mom about being offered land incredibly cheap up on the Killington access road. Their response was ,"Why would I want land up there?" If we had only known.
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Old 06-01-2015, 06:44 AM
 
809 posts, read 678,128 times
Reputation: 1333
The extremely well-off skew markets very badly for the rest of us. Jeffery Skilling (now doing time in a minimum-security prison in Colorado for his Enron criminality) bought a property in Norwich for some $3 million, which was chickenfeed for him-- just six months before Enron collapsed, he got $10 million in stock sales.

The effect of his Holly Hill purchase was to drive up all the real estate prices in the area.

One fellow I know built a home himself for about $40,000. A couple of decades later, somebody bought the view next door, built a house and put it on the market for $890,000. Suddenly, a $40,000 camp is worth $120,000, a good deal for the owner, but hardly affordable for the average Vermonter.
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