School Homestead Tax Rate: How can this be fair?

Submitted a year ago
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Some homestead owners pay more than commercial property owners. Other homesteaders pay less.

The Vermont state school tax makes a distinction between homestead property and nonresidential property. In Norwich, that is not good for homeowners. Homestead owners pay a HIGHER education tax rate ($1.8122) in FY 2018 than all other property owners in Town ($1.5461).  

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Norwich is not alone; homesteaders in about 140 other towns are net ‘losers’ compared to the rate paid by nonresidential property.

BUT, in about 115 towns, homestead property owners pay a LESSER tax rate, than nonresidential property owners.  There, homestead owners are ‘winners’. How can this be fair?

"Boston Tea Party": W.D. Cooper.

A homestead in Vermont is a principal dwelling owned and occupied by a resident individual.  In general, all other property is nonresidential, including businesses, rentals and vacant land. Nonresidential property is taxed at a rate fixed by statute; homestead rates, determined by a statutory formula, vary from to to town depending on the school district per pupil spending. 

Including rental property as nonresidential property is particularly arbitrary.  Take the example of a family with two kids at Marion Cross School. If that family owns the house, it pays tax at the of $1.8122. But, if the family rents, the owner pays about 27 cents less. How can this be fair?  

The distinction has nothing to do with wealth. Charlotte is the municipality with the highest median household income in Vermont. Yet, its homestead owners pay 12 cents LESS per $100 than its nonresidential owners. In contrast, in Springfield, with a median family income about $50,000 less than in Charlotte, the homestead owners pay nearly 10 cents MORE than Springfield's nonresidential  property owners.  

Time to contact your local State Representative!

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