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When the N.C. General Assembly passed a controversial overhaul to the state’s taxing system last year, the promise out of the mouths of Republican sponsors was that it would put more money back in taxpayers’ pockets.

But that’s not the case, the Associated Press found today in a factcheck its reporters conducted on the state’s new tax plan.

“It’s true that the state’s income tax rate is going down for every taxpayer in 2014,” the news agency wrote in an article published today. “But that does not mean all taxpayers will actually pay less to the state government over the coming year.”

That premise of lower tax bills, which has been echoed and repeated by Republican Gov. Pat McCrory, was scrutinized closely at the time of the bill’s passage and debate, with many calling foul on the claims including Cedric Johnson of the N.C. Justice Center’s Budget and Tax Center.

BTC data on N.C. tax increases under new plan

BTC data on N.C. tax increases under new plan

Johnson, in a report published in August, estimated that the bottom 80 percent of North Carolina residents will pay more in taxes under the new tax plan while needed services were slashed and the wealthiest in the state would see reductions in their tax bill. (Disclosure: N.C. Policy Watch is also a part of the N.C. Justice Center.)

The Associated Press took another look this week at the changes to the state’s tax code for 2014 and agreed that the tax breaks promised by lawmakers would not materialize for many people in the state.

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New from the numbers wonks at the Budget and Tax Center:

Allowing the state Earned Income Tax Credit to expire would harm veterans, active-duty military, a new analysis finds

RALEIGH (July 2, 2013) – About 64,000 veteran and active-duty military families in North Carolina would be impacted by current tax plans, all of which allow the state’s Earned Income Tax Credit to expire. New analysis by the Washington, D.C.-based Center on Budget and Policy Priorities and state-level analysis by the Budget & Tax Center found that tens of thousands of military families in North Carolina would be affected.

The Senate tax plan (HB 998, Fifth edition) being debated later today allows the state Earned Income Tax Credit (EITC) to expire, increasing the tax load on tens of thousands of low-income soldiers, veterans, and their families while the wealthiest taxpayers and profitable corporations get a tax break. Read More

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This just in from the Budget and Tax Center:

BTC Statement: Senate budget “fiscally irresponsible”
This budget harms the foundations of economic growth, sets stage for tax plan which will force most to pay more

RALEIGH (May 23, 2013) — The budget passed by the Senate today is fiscally irresponsible. Senators approved a spending plan without details on how they will pay for it. Instead, they put in a place-holder for their tax plan that will cost $770 million over two years, meaning higher taxes for middle- and low-income North Carolinians, and cuts to investments that are vital to our state’s economy.  Read More

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STATEMENT FROM THE N.C. BUDGET & TAX CENTER:

Senate tax proposal shifts burden from the rich to the poor

RALEIGH (May 7, 2013) — The Senate leadership has released a proposal that will harm working families and the broader economy.

By cutting income taxes and expanding the sales tax to more goods and services, the Senate leadership has pursued a shift in tax burden from the rich to the poor, not tax reform. The result is a plan that not only requires low-and middle-income families to pay more while the highest income families pay less, but also reduces the state’s ability to invest in a foundation for economic growth by cutting state revenues by $1 billion each year. That is equivalent to the entire community college system OR the combined budgets of the DHHS Divisions of Aging, Child Development, and Child Health and the Judicial Branch and NC Biotechnology Center.

 

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Confused about the state of tax “reform” in the 2013 General Assembly? Check out these two very useful and user-friendly tools from the N.C. Budget and Tax Center:

This one-page chart gives you the facts you need on all of the major tax proposals introduced thus far in 2013.

This very brief (back and front) document tells you how to assess proposals by yourself.

And don’t forget Financing the Future: Debating State State Tax Reform for North Carolina - a special debate a debate on tax reform in North Carolina, featuring Jared Bernstein of the Center on Budget & Policy Priorities and Elizabeth Malm of The Tax Foundation, two national experts on the subject of taxation and finance. The event is co-sponsored by the BTC, the Pope-Civitas Institute and the Institute for Emerging Issues at NC State University next Tuesday May 7 at 11:45 a.m. 

Click here for more information.