In his June 21 Point of View piece, Andy Ellen rightly criticizes the fairness of state laws governing how cities and towns charge for license taxes. State law contains many historic exemptions and caps that have little rational basis in our modern economy, such as limiting the tax on an ice cream parlor to $2.50 while allowing higher taxes on a cookie store next door.
Cities and towns did not design the current license tax system and dislike its complexity as much as businesses. Fortunately, there is an easy way to fix the tax while allowing governments to maintain an important revenue source. Eliminating all exceptions would significantly broaden the tax base, allowing for lower tax rates.
We should reform this tax on businesses, rather than shift it to homeowners. Burlington has continued to provide a high level of municipal services at an affordable tax rate. Burlington is able to do this, in part, because of our average annual collection of $550,000 in privilege license fees. If Burlington were to lose the right to charge those fees, our residents could potentially face a property tax increase of over 1 cent.
Ronnie K. Wall
Mayor, City of Burlington