Bill H.76 proposes an income tax exemption for the State active duty subsistence and quarters allowance paid to members of the National Guard in Vermont. The bill amends current law by adding language to exempt these allowances from Vermont personal income tax, specifically under 32 V.S.A. § 5823(a). The existing provision that allows for the exclusion of certain military pay is modified to include this new exemption, while deleting the previous stipulation regarding the first $2,000 of military pay for unit training.

Additionally, the bill establishes an effective date of January 1, 2026, with retroactive application to taxable years beginning on or after January 1, 2025. This means that eligible National Guard members will benefit from this tax exemption for the specified prior tax years, providing financial relief for those serving in the National Guard.

Statutes affected:
As Introduced: 32-5823(a), 32-5823