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NC Budget and Tax Center

This year marks the 50th anniversary of the start of the War on Poverty and Wednesday, January 8th in particular marks the 50th anniversary of LBJ’s speech in which America’s War on Poverty was declared. National media and political figures have been weighing in on whether the War on Poverty has worked, is a “Mixed Bag”, or has missed the mark. The Budget and Tax Center will be launching a blog series this month which will look in depth into the lasting effects of the War on Poverty, its successes, and the challenges that still lie ahead. We’ll also be doing some must-read myth busting as it relates to income and poverty.

What we do know is that the poverty rate has declined since the War on Poverty was declared, and it has declined even more significantly when supplements such as the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps) and the Earned Income Tax Credit (EITC) are factored in. What we also know is that even as productivity of workers has increased, wages have stagnated for middle and low income families and inequality has continued to rise.

The War on Poverty and associated safety net programs, which have been a lifeline for millions of families, have done their job to the extent that we have let them. Going forward it is imperative to make adequate and real investments in the programs that we know work in lifting families out of poverty such as the EITC and SNAP, but also to tackle the broader issue of wage stagnation and inequality by ensuring, among other strategies, that we have a minimum wage that reflects the cost of living in the 21st century, and by taking a long hard look at the racial and class inequity that still plagues our nation and our state.

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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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NC Budget and Tax Center

There has been a lot of talk in the state, national and social media world about North Carolina’s reputation as of late, and it doesn’t sound so good. Governor McCrory has repeatedly stated that he was concerned about North Carolina’s brand and intended to rebrand the state to make it more business-friendly. Turns out, North Carolina is already competitive and further, the US Chamber of Commerce tells us “North Carolina is home to a collection of powerhouse research universities and a network of higher education. With innovative and high-tech enterprises spinning from places like the Research Triangle for more than 30 years, North Carolina ranks 12th overall for technology and entrepreneurship this year. The state has the 13th-highest concentration of STEM workers and ranks 4th for academic research and development intensity.”   Read More

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It ought be pretty clear by now that the folks protesting the regressive policies of the current General Assembly are North Carolinians, not outsiders as Gov. Pat McCrory and some legislative leaders have suggested.

If you want to understand who the real outsiders influencing our lawmakers are, check out the column in this morning’s News & Observer by Alexandra Sirota of the N.C. Budget & Tax Center. Read the whole thing—here is a sample.

Whether it’s shoddily researched reports by supply-side economics guru Arthur Laffer or inflammatory rhetoric during visits from Grover Norquist – he of the infamous “no tax” pledge that hamstrings legislators – the influence of outsiders in North Carolina is pervasive. These people and organizations are trying to make the state the latest test case for extreme measures in the guise of “reform.”