Uncategorized

Mama’s Gonna Buy a New Pair of Shoes: The Truth about the Senate Budget

The Senate version of the state budget sunsets two temporary taxes: the ¼ cent sales tax and 8% upper income tax. For middle class families like mine, this means a tax saving of about $50 a year. What should I do with this tax windfall? Fifty dollars won’t even buy a good pair of shoes.

No, the Senate proposal is definitely a ‘rich man’s budget’, it does little for folks like me. Ending the temporary taxes like the Senate proposes puts the state into a budget deficit of about $300 million, which means we don’t have money to make capital improvements to roads, schools and green spaces.

Moreover, the Senate budget includes less money for public education, community colleges or health and safety programs. For the average North Carolina family, the tax savings are minimal compared to the impact on the state.

The state should keep the temporary taxes in place until the entire tax system is modernized, they should make the capital improvements necessary to keep pace with growth and fund programs that help families. I can wear my old shoes a while longer.

3 Comments


  1. Dallas Woodhouse

    June 13, 2007 at 2:15 pm

    It should be noted that many small business operators pay the 8% marginal rate as individual filers. This 8% rate makes it much harder to create, start and expand a small business. To say that only rich people benefit from the rate reduction is just not true. You have to look at the many small operations that have to file as sub-chapter s corps and pay the highest rate.

  2. gregflynn

    June 14, 2007 at 3:22 am

    The 8% rate kicks in for net individual income over $120,000. Expenses for creating, starting or expanding a small business would be deducted from gross income and would reduce tax liability. S-corporations are elective entities and the tax rates apply to individual shareholders separately on their proportional share of income and not on the combined corporate income. Owners choose S-corp status over C-corp because of tax benefits and easier accounting.

  3. aplum

    June 14, 2007 at 8:45 am

    North Carolina needs to modernize its tax system but in a way that is fair to businesses and individuals. We need to expand the tax base to include services not just goods. Businesses need to pay their share.

    We should keep the temporary taxes (sales & income) in place for another two year while we modernize the system. This would put the state on sound financial ground while it transitions in new sources of revenue instead of burdening it with debt.

Check Also

Trump and North Carolina

No related posts.

Top Stories from NCPW

  • News
  • Commentary

Weeks after the top school board member in Robeson County predicted the southeastern North Carolina [...]

A pivotal legislative task force may be just beginning its dive into North Carolina’s school funding [...]

The controversy over “Silent Sam,” the Confederate monument on UNC’s Chapel Hill campus, has been ra [...]

North Carolina tries to mine its swine and deal with a poop problem that keeps piling up A blanket o [...]

With Republicans on Capitol Hill and in the White House desperate to post a big legislative win, the [...]

Latest court system mess is directly linked to the Right’s ideological war on public structures Some [...]

Republicans in Congress are rushing to advance a tax reform bill that balloons the federal deficit s [...]

The post Charitable donations and the GOP’s chopping block appeared first on NC Policy Watch. [...]

Spotlight on Journalism

We invite you to join a special celebration of investigative journalism! The evening will feature Mike Rezendes, a member of the Pulitzer Prize-winning Boston Globe Spotlight Team known for their coverage of the cover-up of sexual abuse in the Catholic Church.

Tickets available NOW!

Spotlight On Journalism

This event will benefit NC Policy Watch, a project of the North Carolina Justice Center. Sponsorship opportunities available now!

Featured | Special Projects

NC Budget 2017
The maze of the NC Budget is complex. Follow the stories to follow the money.
Read more


NC Redistricting 2017
New map, new districts, new lawmakers. Here’s what you need to know about gerrymandering in NC.
Read more