Vermont Salary & Tax Calculator
Vermont's progressive income tax tops out at 8.75% for the highest bracket. Enter your salary below to estimate your true net pay after federal, state, and FICA taxes.
Vermont taxes income through a progressive bracket system that climbs to a top marginal rate of 8.75% for the highest earners, with lower brackets starting around 3.35% for modest incomes. That puts Vermont firmly on the higher end of the tax spectrum in New England and among its immediate neighbors. New Hampshire, directly to the east, charges no tax on wages at all — a stark contrast that has long made it attractive for Vermont-adjacent commuters. New York, to the west, actually exceeds Vermont at the very top with a marginal rate up to 10.9% for its highest earners, while Massachusetts uses a flatter structure: a 5% base rate plus a 4% surtax on income above roughly $1 million, pushing its effective top rate to about 9%. Vermont's relatively high rate reflects its small population and tax base funding a comparatively robust set of public services and rural infrastructure. No Vermont town or city is permitted to add a local income tax on top of the state rate, though some municipalities do levy a local option sales tax that has no bearing on payroll withholding. Because Vermont's system is progressive rather than flat, remember that only the portion of your income in the top bracket is taxed at 8.75% — your blended effective rate will typically be lower, which the calculator below lets you model directly.
*Estimates only, not financial or tax advice. Actual withholding may vary — consult a tax professional for precise figures.
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Full Salary & Tax Calculator🏆 Vermont Paycheck Basics
How Vermont's progressive brackets factor into your take-home pay alongside federal tax and FICA.
How it Works
Vermont's brackets rise to 8.75% at the top, so most filers should use a lower blended rate that reflects only the income actually taxed at each bracket.
The Formula
Net Pay = Gross Pay - (Federal Tax + Vermont State Tax [3.35%–8.75% by bracket] + FICA + Pre-tax Deductions).
Pro Tip
Don't plug in 8.75% flat unless nearly all your income lands in the top bracket — your effective Vermont rate is almost always lower because of the state's progressive structure.
Frequently Asked Questions
What is Vermont's top state income tax rate? +
Vermont's top marginal state income tax rate is 8.75%, applied to the highest bracket of taxable income. Vermont uses a progressive system with several brackets below that, starting around 3.35% for the lowest earners.
How does Vermont compare to its neighboring states? +
Vermont is on the higher end regionally. New Hampshire charges no tax on wages, giving it a major edge. New York's top rate can reach 10.9%, higher than Vermont's, while Massachusetts uses a 5% flat rate plus a 4% surtax on income above roughly $1 million, effectively 9% at the very top.
Do Vermont towns add a local income tax? +
No. Vermont does not permit any town or city to levy a local income tax. Some Vermont municipalities do add a local option sales tax, but that only affects purchases, not payroll withholding.
Why is Vermont's income tax relatively high? +
Vermont has a small population and tax base relative to the public services it funds, including a strong social safety net and rural infrastructure spending, which historically has meant higher per-capita tax rates compared to larger, more populous neighboring states.
Does everyone in Vermont pay the 8.75% rate? +
No. Only income within the top bracket is taxed at 8.75% — Vermont's progressive system taxes lower portions of your income at lower rates first, so your effective (blended) rate will be noticeably below 8.75% unless nearly all your income falls in the top bracket.