Tax Fairness

Taxes are the way we pay for our common wealth and wellbeing (infrastructure, parks, public safety, etc.). In a fair and just society, taxes are based on an ability to pay. They are “income sensitized”. Burlington’s municipal residential property taxes are not income sensitized. 

Municipal property taxes continue to be high and regressive. This inhibits home ownership and destabilizes neighborhoods. It encourages displacement and gentrification. Miro has not made change a priority and we have not made progress on tax fairness in the last two years.

Two years ago, I called for new directions on affordability because we had not done enough to address high and regressive municipal property taxes. The 2021 reappraisal, the first since 2005, made a hard property tax situation worse. Residential property owners received a huge tax increase in every ward and the total increase was over $10 million, rising almost 2% to 80.6% of the City’s property tax collections. At the same time, taxes for commercial properties decreased by over $900,000, 2.2%, to 16.2% of all property taxes generated, and the very highest valued homes received a tax bill reduction. 

Taxes are the way we pay for our common wealth and wellbeing (infrastructure, parks, public safety, etc.). In a fair and just society, taxes are based on an ability to pay. They are “income sensitized”. Burlington’s municipal residential property taxes are not income sensitized. 

Our property taxes are unfair because all homeowners are taxed at the same rate, regardless of their wealth or their ability to pay.  Second homes, houses purchased as investments, and homes used for short-term rental pay property taxes at the same rate as primary residences.  Low and moderate-income renters absorb tax increases passed along by landlords who profit from the housing crisis. The burden of property taxes has increased over the past decade and when we start repaying the new high school bond the burden will increase even more. Valued community members are being driven out of the city and all but the wealthiest are discouraged from moving here. 

We must reduce the impact on our lowest income residents and shift more of the property tax burden to those most able to pay. We need to ensure that Burlington’s tax system promotes homeownership and tenancy that is affordable to low and moderate income households.  We need mechanisms that adjust the cost of taxes more fairly across businesses and higher income households to help to accomplish this.  

This means the City property tax should:

  1. Reflect residents’ ability to pay based on their income.
  2. Rely more heavily on revenue garnered from the highest value real estate in the City.
  3. Shift the balance toward commercial property owners.
  4. Increase revenue generated from second homeowners and from short-term rentals.
  5. Create tax incentives to keep apartment and home rentals affordable.
  6. Include a rent rebate for those of modest income.
  7. Provide more latitude to support bonded debt for future community infrastructure.