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ACT SUMMARY 2007-2008


ACT NO. 81

(H. 521)

Miscellaneous Substantive Tax Amendments

This act makes miscellaneous substantive amendments to Vermont tax laws, as follows:

Sec. 1. [Deleted]

Secs. 2, 3. Electronic Funds Transfer

Repeals the authority of commissioner to extend withholding tax payment date by 4 days for taxpayers required to pay by electronic funds transfer, and replaces it with authority to extend the time by 6 days for electronic filers. This section only relates to withholding taxes paid by employers, and allows them to report to the state on the same schedule as they report to the IRS for withholding.

Sec. 4. Property Tax Adjustments

Current law allows property tax adjustment claims to be amended to correct the amount of household income reported. Taxpayers may amend only if the claim was filed by the April 15 due date. Since we now allow late-filed claims until September 1, this section would allow claimants 3 years to amend household income as long as they filed by September 1.

Sec. 5. Tobacco Tax

Amends the tobacco products tax statutes to provide that in case of a failure to file a return, there is no limit on the amount of time the commissioner has to find the taxpayer and assess the tax. This rule is the same as the statute of limitations for unfiled returns in all other Vermont taxes, and the amendment corrects an oversight in the tobacco tax chapter.

Sec. 6. Tobacco Tax

In the tobacco products tax law, adds a requirement that wholesalers state on their invoices whether the price includes Vermont Tobacco Products Tax. When a retailer buys product, usually cigars, from a non-nexus distributor, if the wholesaler has not paid the tax, the retailer is required to report and pay the tax. This amendment would clarify for retailers when they are subject to tax assessment.

Secs. 7, 7a, 7b. Sales Tax on Aircraft

Commercial aircraft, and the parts used to service them, are exempt from sales tax. Sec. 7 amends the statute to allow the sales tax exemption for parts used to service any aircraft.

Secs. 7a and 7b repeal the change in Sec. 7, as of July 1, 2011. At that time, the sales tax exemption will again be available only for parts used to service commercial aircraft.

Sec. 8. Property Tax Adjustment When Claimant Deceased

Updates a property tax adjustment statute to conform to the new law which requires adjustments to be credited to the property tax bill, not paid to the claimant.

Sec. 9. [Deleted]

Sec. 10. Grand List Valuation for Affordable Housing/Rentals

In the grand list valuation rule for affordable housing/residential rental property, amends the law to add an additional type of federal affordable housing, and requires the accounting for expenses related to the property be in a format acceptable to the commissioner.

Sec. 11. Grandfathered Tax Stabilizations Under Act 60

Act 60 provided that property which was authorized before July 1, 1997, as exempt under a tax stabilization agreement or a local tax exemption vote would remain exempt from education property tax for ten years. That "grandfathering" provision expired this July 1, 2007. This amendment extends that "grandfathering" for one more year to give the legislature time to address those exemptions legislatively.

JFO estimates that the revenue loss could be less than $1.8 million if some of these properties qualify for other education property tax exemptions.

Secs. 12 - 22. Vermont Employment Growth Incentive

Technical amendments to the Vermont Employment Growth Incentive statutes, conforming to Act No. 184 of 2006.

Sec. 23. Downtown Tax Credit

Incorporates the provisions of S.204, increasing the cap for awards under the Downtown Tax Credit. Beginning in FY08, the cap would be increased from $1.5 million to $1.6 million per year.

Sec. 24. Real Estate Closing/Property Tax Adjustments

For 2007 only, on sale of the residence between April 1 and June 21, the seller may request payment from the Tax Department of his or her property tax adjustment.

Sec. 25. Land Gains Tax Exemption for Affordable Housing

Provides a new land gains exemption for land sold to an affordable housing organization.

Sec. 26. Effective Dates. Varied.

Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont