Vermont was ranked 42nd out of all U.S. states for Taxpayer Return on Investment (ROI), according to a new index released by WalletHub on Apr. 3. The ranking compares the amount of taxes paid per person with the quality of government services received in each state.
The report is significant because it highlights the balance between tax burden and public service quality, an issue that affects residents, small businesses, and policymakers across Vermont.
While Vermont scored highly for government service quality—ranking third overall—it placed near the bottom at 48th for tax burden. This combination led to its low ROI rank, putting Vermont last among New England states. In contrast, New Hampshire took first place nationally for taxpayer ROI.
WalletHub’s methodology assessed five key categories: education, health, safety, economy, and infrastructure & pollution. Each state was graded across 29 metrics within these categories to determine an overall government services score before comparing this score to total taxes paid per capita.
Vermont’s ranking matches its placement in the Tax Foundation’s State Tax Competitiveness Index at 42nd place as well. The Tax Foundation profile noted that “Vermont levies all major categories of taxation with comparatively high rates and an overall uncompetitive tax structure.” It also highlighted factors such as a nation-leading property tax burden and high top individual and corporate rates as challenges facing economic growth in the state.
Recent legislative proposals could further increase Vermont’s already high tax rates by doubling income taxes for many small business owners or introducing higher capital gains taxes.
The National Federation of Independent Business represented hundreds of thousands of member businesses across various industries according to the official website. The organization aimed to advocate for small and independent business owners in public policy discussions at federal and state levels according to the official website. Brad Close served as president and chief executive officer per the official website. The group used a one-member, one-vote system to determine its policy positions according to the official website, extended advocacy efforts nationwide per the official website, and influenced policy debates on behalf of small business rights according to the official website.
As discussions continue about future tax policies during this legislative session, observers will be watching how changes may affect both taxpayers’ financial burdens and their access to public services.
