Late last evening, the House leadership released their full $20.6 billion budget proposal (with money report) for the next fiscal biennium. This proposal includes a placeholder for their long-awaited tax reform plan, which anticipates deep reductions in tax rates and significant revenue losses, putting North Carolina on an unfortunate path to mediocrity. Along with the effort to repeal the estate tax, the House tax plan represents a major tax shift and would strip the state of more than $525 million that could be used to fund vital public services, help get North Carolinians back to work, and build a strong economy.
North Carolina cannot afford to pay for tax cuts for the top at the expense of teacher layoffs, growing waiting waits for critical public services, and higher tuition rates. As the chart below illustrates, state spending under the House proposal would continue to remain well below pre-recession levels even though spending over the base budget would slightly increase thanks to the slight uptick in revenue. See this chart to see how the House proposal compares to the Senate and Governor’s proposals. Read More