Hannaford

A local Hannaford is shown.

ESSEX TOWN — Essex Town residents are paying a tax their selectboard decided not to put to vote: the local option tax, due to a miscalculation by Hannaford Supermarkets.

The Local Option Tax came into effect Oct. 1 at City of Essex Junction businesses after the voters approved the tax. The tax was open to all Vermont municipalities to vote on to incur additional revenue through a 1% tax on retail, meals, rooms and/or alcohol by Vermont municipalities. 

The Hannaford store is located within the boundaries of Essex Town, but all Essex Town and Essex Junction addresses share one zip code, causing confusion for which businesses should charge the tax.

“We are in the process of adjusting the tax miscalculation… which is the result of administrative clerical error,” Caitlin Cortelyou, Hannaford Supermarkets external communications manager, stated in an Oct. 11 email to the Reporter.

Impacted customers may bring their receipt to the store for a refund, or may be refunded at time of purchase, Cortelyou stated.

“We apologize for the inconvenience and thank our customers for their patience as we work to resolve this matter,” Cortelyou stated.

When the Town distributed a survey on the LOT in December 2021, 606 town and then-village residents answered the questions. 

Approximately 40% of respondents said they were very or somewhat likely to support a local option tax on retail sales of meals and alcoholic beverages. About 50% of respondents indicated they were unlikely to support those local option taxes, and about 10% were undecided.

The Town ultimately decided not to put the LOT to a vote because of the increased taxes Town residents will see due to the split of the two municipalities. 

“As a consumer, I will be closely reviewing all receipts for purchases made at any Town of Essex business, including restaurants, to make sure I am not being charged the 1% LOT tax in error,” Town of Essex resident Betty Poulin stated in an email to the Reporter.

Poulin was charged for the LOT on two separate trips to Hannaford. On Oct. 8, she was charged 10% meals tax instead of 9% and on Oct. 9 she was charged 7% sales tax instead of 6%. 

“It is unfortunate that the municipality that did not institute the LOT tax is the one that is required to take action to avoid it,” Poulin stated.

Selectboard Chair Andy Watts posted a notice on the Town of Essex Facebook page regarding the LOT charges Town residents may receive. Watts’ post instructs those who own a business within the boundaries of the Town of Essex to re-list their business under a Town of Essex address.

“You may have recently received a letter or email from the Vermont Department of Taxes asking you to update the location of your business,” Watts stated. “If your business is physically located within the Town of Essex you must list the town of Essex, even if your mailing address is recognized by the USPS as ‘Essex Junction.’”

Businesses within the Town who have been charged the city’s local option tax may correct the error with this form.

Written By

Staff Writer

Kate Vanni | she/her/hers | Reporter | Kate covers Town of Essex and City of Essex Junction municipal meetings, schools and local businesses through written and visual storytelling. Reach her at (802)-448-0253

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