House Ways & Means hears competing testimony on proposed 13.3% top rate and investment proceeds tax

The House Ways and Means Committee heard three hours of testimony April 16 on a proposal that would add a new top income tax bracket and a 4% investment proceeds tax, with witnesses sharply divided on whether the changes would protect public services or harm small businesses and state competitiveness.

Steph Yu, executive director of the Public Assets Institute, told the panel the state faces growing inequality and federal retrenchment that justify more progressive state revenue. "Vermont's tax system . . . is still regressive at the top," Yu said, and she warned that federal changes could reduce supports Vermonters rely on: about 160,000 Vermonters use Medicaid (roughly 60,000 of them children), the state faces an estimated $2.7 billion in lost federal funding over the next decade, and the end of enhanced premium tax credits affected roughly 30,000 Vermonters and about…