Personal Income Taxes

• Vermont assesses an income tax on most earnings from wages, tips interest and dividends. The lowest income tax bracket in the Vermont Tax Code is 3.55 percent; the highest is 8.95 percent. Vermont recognizes personal exemptions of $3,500 for single individuals, $3,500 for dependents and $7,000 for married couples.
  
  

Sales Taxes

• Vermont levies a sales tax of 6 percent, with exemptions for such things as fuel, heating oil and electricity, medical supplies and other items, food, clothing and shoes that cost $110 or less. Counties and cities may impose additional sales or transaction taxes. Vermont also charges a tax of 24.5 cents per gallon on gasoline, 29 cents per gallon on diesel fuel, and $2.24 per pack of 20 cigarettes.
  
  

Estate and Inheritance Taxes

• Vermont imposes a tax on estates above $3,500,000 in value. The calculation of estate tax liability is different from the methodology for the federal estate tax. All estates required by law to file a federal estate tax return must also file a Vermont Form E-1.
  
  

Property Taxes

• Vermont imposes a tax on homesteads for the purposes of funding public education. Local school districts and municipalities may also assess an additional property tax that varies by location. Additionally, Vermont charges a tax on real estate property transfers of 0.5 percent on the first $100,000 and 1.125 percent on the remainder of the transaction. Mortgages obtained through the Vermont Housing Finance Agency are exempt from tax on the first $100,000 of property.