NC Treasurer Janet Cowell is concerned that efforts to cap the state income tax. Imposing a rate ceiling could cost North Carolina losing its excellent bond rating, making it more expensive for the state to issue debt. The Treasurer outlined concerns over Senate Bill 817 in a letter to legislative leaders (posted below), but the Senate Finance Committee refused to give Ms. Cowell time during debate to describe why the bill will raise red flags for the companies that assess North Carolina’s credit-worthiness.
It is revealing that the committee wouldn’t allow the elected representative who is responsible for safeguarding North Carolina’s finances to address the damage that could result from changing the state constitution. We’re talking about changing the state’s founding document, no small thing, so surely our elected leaders need to hear the facts before they make a call.
As can be seen in the Treasurer’s letter, capping the state income tax would tie the state’s hands, leaving us vulnerable to the next recession, bad storm, or other unforeseen event.
As my colleague noted earlier, the essence of democracy is for two sides to make their cases and see what happens. There’s still time for a real debate to happen, and we need one before a choice of this magnitude.