NC Budget and Tax Center

According to documents made available to the media, we have details of one of what could be multiple tax proposals that the Governor’s office is putting into the mix as the House and Senate leadership negotiate a final tax plan.   

While the Governor has clearly continued to prioritize revenue neutrality – an important pursuit in these times – and gets much closer than any of the other plans, his proposal “Alternative 3A” still falls short. Overall, the governor’s tax plan would reduce annual revenue available for public investments by around $215 million upon full implementation, which is less than annual revenue lost from the House ($500 million annually) and Senate ($1.3 billion annual) plans. Read More


McCroryBergerTillisAs legislators work feverishly to wrap-up the state budget, Raleigh’s News & Observer takes the leadership to task in Friday’s must-read editorial that describes this session as  shortsighted, based on the “politics of revenge and destruction.” Here’s an excerpt:

When they got control of the General Assembly, Republicans vowed to drive North Carolina in a new and better direction. Instead, they’re behind the wheel in a demolition derby.

As The News & Observer’s Rob Christensen reported, GOP leaders on Jones Street are in the process of dismantling every positive Democratic-sponsored program or legislation they can get their hands on. And as result, everyone from public school teachers to families on Medicaid to the scientists at the innovative N.C. Biotechnology Center are going to feel the consequences, some of them very bad consequences indeed, from the Republican knives.

Some of the actions are clearly ideological and partisan: abolition of the Racial Justice Act, for one example. But other actions that have been taken or are under negotiation smack of political immaturity. They’re just about doing away with anything the Democrats did in the way of innovative or helpful programs just because…the Democrats did it.

Consider: The legendary Gov. Kerr Scott, “the squire of Haw River,” expanded state unemployment benefits from 20 to 26 weeks in 1951. The benefits are practical as well as humane, because they keep money in the state economy. Republicans are cutting the benefits to a sliding scale of between 12 and 20 weeks. (They’ve also cut the maximum benefit and lost an opportunity to extend federal benefits to the long-term unemployed at no cost to the state.)

Hurting people

Or: The Child Fatality Task Force was created by the legislature under Republican Gov. Jim Martin in 1991 to aim at reducing infant and child deaths. The rate has dropped dramatically. The House wants to end it.

And in the area of enlightened actions to give the public more participation in political financing, Democrats in the legislature in 1977 allowed taxpayers a voluntary check-off on their tax forms to give $3 to a fund to help political parties, and in 2002 created a public financing system for high-level judicial races. They also in 2007 allowed public financing, through a voluntary tax check-off, for Council of State offices of treasurer, insurance commissioner and superintendent of public instruction. Republicans aim to end them all.

These types of actions will hurt people, pure and simple. Read More

NC Budget and Tax Center

Low-income families actually fare worse under House and Senate tax plans

Proponents of the House plan claim that doubling the standard deduction and child tax credit provide a generous benefit to low- and middle-income taxpayers in North Carolina. However, what proponents fail to acknowledge is that, at the same time, they are eliminating the personal exemption allowance and allowing the state Earned Income Tax Credit to expire, which effectively makes our current tax law a better bet for these taxpayers.

Proponents support this claim by highlighting that doubling the standard deduction would make the state have the most generous treatment of the first dollar of income in the country. This claim is simply false. Read More

NC Budget and Tax Center

A report released today by the NC Budget and Tax Center highlights the Senate version of the House tax plan. Far from representing true tax reform, the tax plan would give massive tax cuts to the wealthiest North Carolina taxpayers and profitable businesses. Once all the tax cuts are fully in place, $1.3 billion less in revenue would be available to fund our schools and universities, public safety and other public investments that have positioned North Carolina as a leader among Southern states.

The BTC report highlights others aspects of the Senate tax plan worth noting. The plan does not address the state’s upside-down tax system, in which low- and moderate-income families spend a larger share of their incomes on state and local taxes compared to wealthy North Carolinians. Thus, the Senate plan will continue to ask more from those with the least amount of income and the wealthiest taxpayers will receive the lion share of the benefits of these tax cuts. Read More


The Senate Finance Committee is currently debating and will likely vote on the Senate leadership’s new version of the House tax plan passed on Monday evening. This plan is an extremely costly one that provides huge tax cuts to North Carolina’s wealthiest residents and profitable corporations. The fiscal analysis provided with the tax plan shows that more than $1 billion in revenue would be lost each year once the plan is fully implemented. And, the cumulative impact over the next five years is equivalent to one-fifth of today’s budget. This means cuts on top of the drastic cuts enacted over the last several years. Read More