Commentary

New report confirms destructive impact, disparate racial effect of NC’s ongoing tax cut frenzy

A new report from the NC Budget and Tax Center provides the latest confirmation that the steady and ongoing erosion of North Carolina’s tax base by conservative state lawmakers is having a destructive impact on the state and its future. The new report finds that “the new tax cuts, when combined with tax cuts passed since 2013, will mean $3.5 billion in less revenue every year for the state.”

Here’s introduction:

“The new two-year state budget passed by lawmakers included another package of tax cuts that will further limit the amount of revenue available for public investments. The latest tax cuts will reduce annual available revenue by $900 million and, when combined with tax cuts passed since 2013, result in an estimated $3.5 billion in less annual revenue compared to the tax system that was in place prior to tax changes in 2013.

The new budget shows only $521 million of the $900 million in annual revenue loss, due to the way in which lawmakers phase in the tax cuts. The tax cuts kick in starting January 2019 – the second half of the second year of the two-year budget. Thus, lawmakers were not required to account for roughly $400 million of the annual cost of the tax cuts, as the fiscal impact of the tax cuts only reflect half of fiscal year 2019 (January 2019 through June 2019). However, future lawmakers will have to address the unaccounted for $400 million reduction in revenue availability, as the state’s constitution requires lawmakers to pass a balanced state budget.”

The report also finds, perhaps not surprisingly, that recent North Carolina tax cuts have disproportionately benefited white taxpayers:

“Not only have tax changes passed since 2013 held in place systems that solidify income inequality, but they also have reinforced systemic racism that excludes racial and ethnic groups from the path to upward economic mobility by delivering the greatest share of the net tax cut to white taxpayers and undercutting public investments. Eighty-one percent (81 percent) of the net tax cut goes to white taxpayers, despite this group of taxpayers representing two-thirds (66 percent) of North Carolina taxpayers. By contrast, only 19 percent of net benefits go to taxpayers of color, despite these taxpayer groups representing 34 percent of all taxpayers.”

Click here to access the full report.

One Comment


  1. Bill Satterwhite

    August 18, 2017 at 11:24 am

    I appreciate the thrust of this report. However, I take exception to relating the burden of tax cuts only to people of color. I think it is purely economic. The lower middle class and the traditional and generational poor have been hurt by these tax cuts regardless of color. Its as much class warfare as it is race, in my view. Either way, its bad policy.

Check Also

BREAKING: New analysis shows GOP tax plan would be “devastating” to North Carolina nonprofits

This is usually the time of year during ...

Top Stories from NCPW

  • News
  • Commentary

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 [...]

This story is part of "Peak Pig," an examination of the hog industry co-published with Env [...]

Few issues in the North Carolina’s contentious policy wars have been more consistently front and cen [...]

Five years ago, the U.S. Department of Justice (DOJ) filed a jaw-dropping civil rights lawsuit again [...]

Will Burr and Tillis really vote for this? For much of the 20th Century, one of the labels that Amer [...]

President Trump and Congressional Republicans aim to rebrand enormous tax cuts for the wealthiest ho [...]

20—number of years since a bipartisan coalition in Congress passed the Children’s Health Insurance P [...]

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