Vermont

State and local taxes in Vermont are not only relatively heavy (in 2003, they amounted to 10.1% of income, and Vermont was ranked 12th highest in the country), but also variable (rates have been raised and lowered eight times since 1980) and highly centralized (over 78% of total state and local revenues are collected at the state level). In 2003, the Vermont's personal income tax also had the highest thresholds in the country: the five-bracket schedule ranged from 2.3% (on taxable income up to $27,950) to 9.5% (on taxable income above $307,050). Corporate income is taxed according to a four-bracket schedule ranging from 7% (on net income up to $10,000) to 9% (above $250,000), with a minimum corporate tax of $250. The state sales and use tax rate is 5%, with basics, including food and medicines, exempted, and local sales taxes limited to 1%. The state also imposes a full array of excise taxes covering motor fuels, tobacco products, insurance premiums, public utilities, alcoholic beverages, pari-mutuels, and other selected items. State property taxes are means-tested, and there is a broad property tax rebate program. There is no inheritance tax, but the Vermont legislature has taken action to preserve the state's estate tax independent of the scheduled phase-out of the federal tax exemption for state death taxes. Death and gift taxes accounted for 0.8% of state collections in 2002. Other state taxes include various license fees and stamp taxes.

The state collected $1.533 billion in taxes in 2002, of which 31.6% came from state property taxes, 24.4% from individual income taxes, 20.5% from selective sales taxes, 14% from the general sales tax, 4.5% from state license fees, and 2.4% from corporate income taxes.

The following table from the US Census Bureau provides a summary of taxes collected by the state in 2002.