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Old 03-26-2013, 11:41 AM
 
1,756 posts, read 4,557,324 times
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I recently read about the new tax options for NC, outlined in the article below:

Four options for reforming N.C.'s tax system | Other Views | NewsObserver.com

• “Option A” makes North Carolina the most pro-growth tax system in the country, simplifying the personal income tax at 6 percent, lowering the statewide sales tax to 3.5 percent while expanding its base to services, and repealing the corporate income and franchise taxes.

• “Option B” keeps all the major taxes, but simplified and at low rates: a 5 percent income tax, 5 percent sales tax and 5 percent corporate tax. A similar positive reform was adopted in Utah, contributing to its economic success.

• “Option C” would eliminate taxes on individual and corporate income and broaden the sales tax base to services to make up the revenue. The total state sales tax rate would have to be raised to 8.75 percent to fully fund current levels of state spending, but the benefit of this option is that North Carolina would be one of the few states with no taxes on investment or job creation.

• “Option D” eliminates taxes on retail sales and corporate income, paying for these reductions with a single, simple tax on individual income at a flat 10 percent rate.

*****************

I'm wondering what NC residents think about these tax "reforms" and are any of them better than what exists now for individual taxpayers? Several other states around the country are looking at reducing state income tax rates for individuals and raising sales taxes to make up the difference. I guess that would fall into Options C & D above.
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Old 03-26-2013, 12:51 PM
 
Location: Sneads Ferry, NC
11,224 posts, read 19,670,603 times
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As a retired person, I would be strongly opposed to option D. I am opposed both because it would raise taxes on my modest income, and because removing all corporate taxes seems irresponsible.

Of the remaining alternative, only B seems acceptable.
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Old 03-26-2013, 01:40 PM
Status: "On The Lookout" (set 21 days ago)
 
Location: The Triad (NC)
28,383 posts, read 61,750,545 times
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Quote:
Originally Posted by xz2y View Post
I recently read about the new tax options for NC..
I'm wondering what NC residents think about these tax "reforms"
In short they ALL avoid the real problem: Too few earning enough to pay taxes at whatever rate.
A lot more need solid jobs and all need a lot more pay than most NC employers are used to.

Quote:
...are any of them better than what exists now for individual taxpayers?
Not really. Of the poor choices... option A (6% income, 3.5% sales tax) is the least worst.
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Old 03-27-2013, 01:07 AM
 
5,128 posts, read 5,813,945 times
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I'm thinking anything that can't compete with what Texas offers, isn't going far enough.

I love NC, but it hasn't been competitive for a long time.

It interesting that the article link says that NC only raises 4% of it's budget from corporate taxes, yet that's the tax that most discourages businesses.
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Old 03-27-2013, 06:14 AM
 
Location: Durham, NC
2,536 posts, read 8,105,202 times
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Option C wins for me. I'd like to see that paired with a national consumption tax (i.e. the Fair Tax model) such that we could eliminate the very confusing and loophole loaded income taxes and greatly reduce the IRS and the NC Dept of Revenue.
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Old 03-27-2013, 06:22 AM
Status: "On The Lookout" (set 21 days ago)
 
Location: The Triad (NC)
28,383 posts, read 61,750,545 times
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Quote:
Originally Posted by Shooting Stars View Post
I'm thinking anything that can't compete with what Texas offers, isn't going far enough.
Be careful what you wish for.
Texas Politics - Political Economy

Quote:
...NC only raises 4% of it's budget from corporate taxes,
yet that's the tax that (gets claimed to) most discourage business.
hmmm
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Old 03-27-2013, 07:08 AM
LLN
 
Location: Upstairs closet
4,976 posts, read 8,713,298 times
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You optimist amaze me. If we change, it will probably be for the worse!
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Old 03-27-2013, 12:55 PM
 
Location: Charlotte, NC
1,969 posts, read 3,065,286 times
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I was of the impression that a flat tax for everyone would be a very bad thing, since it wouldn't take the level of income into consideration, impacting poor people more than rich people. Is that not the case?
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Old 03-27-2013, 03:03 PM
 
12,578 posts, read 13,253,348 times
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Quote:
Originally Posted by MrRational View Post
In short they ALL avoid the real problem: Too few earning enough to pay taxes at whatever rate.
A lot more need solid jobs and all need a lot more pay than most NC employers are used to.


Not really. Of the poor choices... option A (6% income, 3.5% sales tax) is the least worst.
It doesn't seem to occur to employers & government the more people working full time good paying jobs will pay more taxes all the way around. Instead all they know how to think about is cut, cut, cut.
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Old 03-27-2013, 03:15 PM
 
12,578 posts, read 13,253,348 times
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[quote=xz2y;28843497]I recently read about the new tax options for NC, outlined in the article below:

Four options for reforming N.C.'s tax system | Other Views | NewsObserver.com

Quote:
Originally Posted by xz2y View Post
• “Option A” makes North Carolina the most pro-growth tax system in the country, simplifying the personal income tax at 6 percent, lowering the statewide sales tax to 3.5 percent while expanding its base to services, and repealing the corporate income and franchise taxes.
I just can't see how this could work
Quote:
Originally Posted by xz2y View Post
• “Option B” keeps all the major taxes, but simplified and at low rates: a 5 percent income tax, 5 percent sales tax and 5 percent corporate tax. A similar positive reform was adopted in Utah, contributing to its economic success.
This seems reasonable enough, but Utah also attracts young cheap labor.
Quote:
Originally Posted by xz2y View Post
• “Option C” would eliminate taxes on individual and corporate income and broaden the sales tax base to services to make up the revenue. The total state sales tax rate would have to be raised to 8.75 percent to fully fund current levels of state spending, but the benefit of this option is that North Carolina would be one of the few states with no taxes on investment or job creation.
This would kill those on low/fixed incomes
Quote:
Originally Posted by xz2y View Post
• “Option D” eliminates taxes on retail sales and corporate income, paying for these reductions with a single, simple tax on individual income at a flat 10 percent rate.
This would hurt the low income earners and people on fixed incomes.

Quote:
Originally Posted by xz2y View Post
I'm wondering what NC residents think about these tax "reforms" and are any of them better than what exists now for individual taxpayers? Several other states around the country are looking at reducing state income tax rates for individuals and raising sales taxes to make up the difference. I guess that would fall into Options C & D above.
The problem with flat tax is the upper income get to keep more of their money while hurting low income earners. Additionally some tax breaks/credits are designed to spur spending and give incentive to major life changes such as starting a family or buying a home.
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