Some things are better done voluntarily. For the sake of the Vermont economy and taxpayers, paying for paid family leave is one of those things.
“First, the bill would impose a brand-new 0.20 percent payroll tax (plus another 0.38 percent optional tax for temporary disability insurance). That is on top of the sales tax, income tax, property tax, motor vehicle taxes, and more, that Vermonters already have to pay. It amounts to a multi-million dollar tax hike on Vermonters--even if they do not use the program. That is unaffordable, at a time when many Vermonters are unable to make ends meet. And if the costs of the program go up--or if lawmakers decide the current tax rate is insufficient--the payroll tax will go up too. In other words, this creates yet another tax-raising scheme for lawmakers to play with.
Second, the bill does not rule out the state creating a brand new government entity to administer the program, which experts from the executive branch have testified will not only cost millions of dollars, but also will require new government employees and shift the risk of program insolvency onto the taxpayers. In our mind, this will lead to yet another excessive bureaucracy, flawed in the same manner as recent programs like Vermont Health Connect.
Third, the program is a mandate. Governor Scott presented a twin-state, reasonable, and voluntary alternative that leveraged the state employee base of both Vermont and New Hampshire and the ability of Vermont and New Hampshire businesses to all opt-in to the program on a voluntary basis. This increased the size of the pool, helping to lower costs. But Vermonters who could not afford the program (or otherwise were not interested) did not have to pay in. That is not the case in this bill—it is mandatory, whether you like it or not, and the payroll tax must be paid either way."
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