Local Option Tax

In March, Colchester voters approved the adoption of a Local Option Tax (or LOT). The Select Board voted to bring this proposal forward for voter consideration following 2 public hearings, 3 additional Select Board meetings on the topic in the last 18 months, and endorsement of a local business group, the Colchester Community Development Corporation (PDF).  The LOT goes into effect beginning October 1, 2015.

Town staff work diligently to hold down spending while seeking other revenue sources to reduce the property tax burden on Colchester taxpayers. A Local Option Tax on rooms, meals, sales and alcohol adopted in Williston, South Burlington, Burlington and St.Albans Town has resulted in lower property tax rates in these towns. By adopting a LOT, it is estimated 87% would be paid by non-residents of Colchester. It is estimated that a Local Option Tax in Colchester could generate as much as $1.3 million per year. The approved proposal intends to use the Local Option Tax primarily for debt reduction and lowering Town taxes by 5% in FY 16; it also allows for using the LOT toward capital improvement projects, but only upon voter approval.

Please consult the documents under "Additional Information," below, for more info on:
  • Why is the Local Option Tax being proposed?
  • What is being done to make the Town more affordable?
  • How the Town could benefit from the Local Option Tax?
  • Who would pay the Local Option Tax and how much?
  • How the voters will control the spending of this revenue source?
  • What purchases are exempt from the tax?
  • The question before the voters.
More info on Local Option Taxes can be found on the State of Vermont's website: http://www.state.vt.us/tax/businesslocaloption.shtml
Thank you for your consideration of this important issue. View a video on the Local Option Tax.

Additional Information