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Introduced by Committee on Ways and Means


Subject:  Taxation; miscellaneous

Statement of purpose:  This bill proposes to make miscellaneous substantive amendments to various tax laws.


It is hereby enacted by the General Assembly of the State of Vermont:

* * * Property Tax * * *

Sec. 1.  32 V.S.A. § 3481(1) is amended to read:

(1)  “Appraisal value” shall mean, with respect to property enrolled in a use value appraisal program, the use value appraisal as defined in subdivision 3752(12) of this title, multiplied by the common level of appraisal, and with respect to all other property, the estimated fair market value.  The estimated fair market value of a property is the price which the property will bring in the market when offered for sale and purchased by another, taking into consideration all the elements of the availability of the property, its use both potential and prospective, any functional deficiencies, and all other elements such as age and condition which combine to give property a market value. Those elements shall include a consideration of a decrease in value in non‑rental residential property due to a housing subsidy covenant as defined in section 610 of Title 27, or the effect of any state or local law or regulation affecting the use of land, including but not limited to chapter 151 of Title 10 or any land capability plan established in furtherance or implementation thereof, rules adopted by the state board of health and any local or regional zoning ordinances or development plans.  In determining estimated fair market value, the sale price of the property in question is one element to consider, but is not solely determinative.

For residential rental property that is subject to a housing subsidy covenant or other legal restriction, imposed by a governmental, quasi‑governmental, or public purpose entity, on rents that may be charged, fair market value shall be determined by an income approach using the following elements:

(A)  market rents with utility allowance adjustments for the geographic area in which the property is located as determined by the federal office of Housing and Urban Development or in the case of properties authorized under 42 U.S.C. § 1437, 12 U.S.C. § 1701q, 42 U.S.C. § 1485, 12 U.S.C. § 1715z‑1, and 42 U.S.C. § 1437f, the higher of contract rents (meaning the amount of federal rental assistance plus any tenant contribution) and HUD market rents;

(B)  actual expenses incurred with respect to the property as provided by the property owner and certified by an independent third party;

(C)  a vacancy rate that is 50 percent of the market vacancy rate as determined by the United States Census Bureau with local review by the Vermont housing finance agency; and

(D)  a capitalization rate that is typical for the geographic area determined and published annually prior to April 1 by the division of property valuation and review after consultation with the Vermont housing finance agency.

* * * Electronic Funds Transfer * * *

Sec. 2.  32 V.S.A. § 5842(a)(4) is amended to read:

(4)  The commissioner shall prescribe the method of payment of tax and may, without limitation, require electronic funds transfer or payment to a bank depository.  The commissioner may, in writing, permit or require returns to be made covering other periods and upon such dates as the commissioner may specify and require payments of tax liability at such intervals and based upon such classifications as the commissioner may designate:

(A)  to conform to federal withholding law as the commissioner deems appropriate;

(B)  in cases in which less frequent reporting is determined by the commissioner to be sufficient; and

(C)  in cases in which the commissioner determines that the taxpayer’s repeated failure to file or pay tax makes more frequent reporting necessary to insure the prompt and orderly collection of the tax;

(D)  in cases in which electronic funds transfer is required, to allow up to four additional days for payment.

Sec. 3.  32 V.S.A. § 3201(a)(8) is added to read:

(8)  In cases in which payment of taxes is allowed or required by electronic funds transfer, allow up to six additional days for payment.

* * * Property Tax Adjustments * * *

Sec. 4.  32 V.S.A. § 6074 is amended to read:

§ 6074.  amendment of certain claims

At any time within three years after the date for filing claims under subsection 6068(b)(a) of this chapter, a claimant who timely filed a claim by September 1, may file to amend that claim, to correct the amount of  household income reported on that claim.

* * * Tobacco Tax * * *

Sec. 5.  32 V.S.A. § 7817 is amended to read:

§ 7817.  determination of tax on failure to file return

(a)  If any person, having failed to file when due a return relating to the tobacco products tax under this chapter, fails to file such return within 10 days after notice is given to him by the commissioner that such return is required, the commissioner may compute the tax liability of the taxpayer with respect to which the return was required to be filed, according to the commissioner’s best information and belief, at any time within three years after the date the return was due, and give written notice of such determination to such person.

(b)  When the commissioner discovers, by examination of the records of the taxpayer as provided in section 7816 of this title, or otherwise, that a person required to file a return under this subchapter, has filed an incorrect or insufficient return, he may, at any time within three years after the date the return was due, determine the correct amount of tax and shall give notice to the taxpayer of the amount of any deficiency in such tax, together with penalty and interest as hereinafter provided.  If no return has been filed as provided by law, the tax may be assessed at any time.

(c)(b)  A determination by the commissioner in accordance with subdivision (a) or (b) of this section shall fix the tax, unless the person against whom it is assessed shall, within 60 days after receiving the notice of such determination, apply to the commissioner for a hearing as is herein provided.  The decision of the commissioner after the hearing may be reviewed as provided in this chapter.

Sec. 6.  32 V.S.A. § 7811 is amended to read:

§ 7811.  imposition of tobacco products tax

There is hereby imposed and shall be paid a tax on all tobacco products except roll‑your‑own tobacco and little cigars taxed under section 7771 of this title possessed in the state of Vermont by any person for sale on and after July 1, 1959 which were imported into the state or manufactured in the state after said date, except that no tax shall be imposed on tobacco products sold under such circumstances that this state is without power to impose such tax, or sold to the United States, or sold to or by a voluntary unincorporated organization of the armed forces of the United States operating a place for the sale of goods pursuant to regulations promulgated by the appropriate executive agency of the United States.  Such tax on tobacco products shall be at the rate of 41 percent of the wholesale price for all tobacco products except snuff which shall be taxed at the rate of $1.49 per ounce, or fractional part thereof, and is intended to be imposed only once upon any tobacco product.  Provided, however, that upon payment of the tax within ten days, the distributor or dealer may deduct from the tax two percent of the tax due.  It shall be presumed that all tobacco products within the state are subject to tax until the contrary is established and the burden of proof that any tobacco products are not taxable hereunder shall be upon the person in possession thereof.  Wholesalers of tobacco products shall state on the invoice whether the price includes the Vermont tobacco products tax.

* * * Aircraft Exemption * * *

Sec. 7.  32 V.S.A. § 9741(29) is amended to read:

(29)  Aircraft, including depreciable parts, machinery and equipment to be installed as a capital asset in such aircraft, sold to a person which holds itself out to the general public as engaging in air commerce, for use primarily in the carriage of persons or property for compensation or hire; and depreciable parts, machinery and equipment to be installed as a capital asset in such aircraft.

* * * Dead Claimant/No Escheat * * *

Sec. 8.  32 V.S.A. § 6063 is amended to read:

§ 6063.  Claim as personal; escheat

The right to file a claim under this chapter is personal to the claimant and shall not survive his or her death, but the right may be exercised on behalf of a claimant by his or her legal guardian or attorney‑in‑fact.  When a claimant dies after having filed a timely claim, the reduction payment may be issued to another member of the household as determined by the commissioner.  If the claimant was the only member of the household, the claim shall be paid to the executor or administrator, but if neither is appointed within two years of the filing of the claim, the amount thereof shall escheat to the state shall be paid to the town in which the housesite of the deceased is located for credit to the claimant’s estate for property tax liabilities as provided in section 6066a of this title.


This act shall take effect upon passage except:

(1)  Secs. 2 and 3 (additional time to pay electronically‑filed tax returns) shall take effect July 1, 2008.       

(2)  Sec. 5 (no statute of limitations for assessment of tobacco tax in cases of failure to file) shall apply with regard to returns with a filing due date of July 1, 2004, or after.

Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont