Markowitz says “Working Families' Tax” Wrong Idea

MONTPELIER—Secretary of State Deb Markowitz said now is the time for creative ideas to resolve Vermont’s Unemployment Fund deficit, but taxing workers is the wrong idea at the wrong time.  “Increasing taxes on working Vermonters will hurt families that are already struggling.  We should instead take advantage of emergency aid available through federal programs to help us ride out economic storm.” Markowitz said the state should also step up its investigations of abuses in the system.

“A long term vision for economic recovery must be the highest priority for Vermont.”  Markowitz said. “Montpelier underfunded our unemployment insurance program by increasing benefits without increasing contributions paid by employers to support the fund.  Now, when we need it the most because unemployment is at nearly seven percent, the fund is out of money.   President Obama has made a wise decision to boost the no-interest loans to states adversely affected by the downturn. We should use this opportunity to reset our economy, get people the help they need and start creating jobs by supporting existing businesses in Vermont that are ready to grow. The last thing we should do is take more money out of a family’s budget or spike unemployment taxes on small businesses.”

A new Senate proposal would tax the paychecks of nearly 330,000 wage earners in Vermont. The tax increase would affect the average wage earner in Vermont by about $40-$80 per year.

Vermont has already begun to seek assistance of no interest loans from the federal government to bail out the state's unemployment fund. Markowitz said using the no interest bridge funding will give us time to grow our economy. 

“Once Vermonters are back to work, and our businesses are on solid footing, it will be easier to make the necessary adjustments to the fund to make it sound. First-time filings for benefits have decreased again today and our economy will improve if we get aggressive about supporting existing businesses," Markowitz said. "No interest bridge funding can help us ride out these down times without increasing the burden on businesses and families.”

Markowitz also said greater efforts should be made to stop fraud and abuse in the system. Even if the savings are minimal, Markowitz said that abuses to the system need to be accounted for, so that we can preserve the benefits for workers who are entitled to receive them.