Republicans Propose $2.1 Billion in Cuts on Income Taxes; Removes Some From Rolls | Beaufort County Now | Personal income tax rates would be slashed and the corporate tax rate entirely eliminated by 2028 under a proposal rolled out on Tuesday, May 25, by N.C. Senate Republicans.

Coronavirus Disease 2019 (COVID-19)
Publisher's Note: This post appears here courtesy of the Carolina Journal. The author of this post is David N. Bass.

Sen. Paul Newton, R-Cabarrus | Photo: Maya Reagan / Carolina Journal

    Personal income tax rates would be slashed and the corporate tax rate entirely eliminated by 2028 under a proposal rolled out on Tuesday, May 25, by N.C. Senate Republicans.

    The plan would reduce North Carolina's flat income tax rate from 5.25% to 4.99%. It would also raise the standard deduction from $21,500 to $25,500 for joint filers, taking about 200,000 of the lowest income North Carolinians entirely off the tax rolls.

    Additionally, the tax package would raise the child tax deduction by $500, meaning a family with a household income at or below $40,000 would receive a $3,000 deduction for each qualifying child.

    "The Republican philosophy when government collects more money than it needs is to give it back through tax relief, and that's what we're doing here," said Sen. Paul Newton, R-Cabarrus. "Tax money is not government money. It belongs to the people of North Carolina who earned it, and it should go back to the people and be used by the people."

    "For the past decade, North Carolina has led the nation in tax reform policy under Republican leadership, and as a result our state's economy is booming and state revenues are at an all time high," said Sen. Warren Daniel, R-Burke.

    According to a press release by Senate Republicans, the tax cuts would benefit low-income households the most:

  • A family of four earning 70% the median household income ($38,221) would receive a 45.6% tax cut.
  • A family of four earning the median household income ($54,602) would receive a 21.2% tax cut.
  • A family of four earning 400% the median household income ($218,408) would receive a 6.9% tax cut.

    The tax-reform package would also phase out the state's corporate income tax over the next seven years. Now, North Carolina has the lowest corporate income tax rate in the country, at 2.5%. It would also reduce the franchise tax that businesses must pay by 25%.

    Another outcome of the Senate proposal is a likely conflict with the House over the tax treatment of Payroll Protection program loans for North Carolina businesses. In April, the House passed a bill that would allow businesses that received PPP loans from the federal government to have any expenses the funds were used for deducted from state tax.

    Newton said during the news conference Tuesday that the Senate differed with the House on the tax treatment of PPP loans. Instead, the Senate proposal would allocate $1 billion in grants using federal emergency relief dollars to businesses that received earlier rounds of COVID-19 relief.

    Another area of difference: The House has passed a bill that would allow the taxpayers to deduct their unemployment checks on their state taxes, but the Senate plan does not include that provision.

    The proposal was discussed in the Senate Finance Committee on Tuesday and is expected to move through the Senate in the coming weeks.
Go Back


Latest Op-Ed & Politics

So far this year, Gov. Cooper has pledged over $930.7 million in tax incentives to just 22 corporations, including $845.8 million over four decades to Apple
Candidate filing for the 2022 statewide primary and rescheduled municipal elections begins at noon on Monday, December 6, and ends at noon on Friday, December 17.
In May, the UNC School of Medicine revised its Guidelines for Appointment, Reappointment, and Promotion.
While a bill that would legalize sports betting across North Carolina passed a House committee last week, odds are heavily against it passing the full General Assembly before the session ends.
James W. Frick had a head full of Carolina common sense. Born in New Bern, in 1924, he was raised in a Catholic orphanage and graduated from Notre Dame.
Tristen Wallace began his college days at the University of Oregon with dreams of eventually playing in the NFL. But shortly into his college career, he was accused by two women of rape and expelled.


State Sen. Tom McInnis, R-Richmond, has moved his permanent residence from Richmond County to his second home in the Pinehurst area of Moore County to run for the newly-drawn state Senate District 21, which will include all of GOP-rich Moore County, and much of Cumberland County.
Former Border Patrol Chief Rodney Scott, who was forced out of his position by the Biden administration earlier this year, issued a stark warning during an interview, saying that the greatest threat that the U.S. is facing is the current administration withholding information from the public.
Amanda Knox fiercely defended teenager Kyle Rittenhouse, who was found not guilty last month on all charges related to a fatal shooting that took place in August 2020.
Last year, Forbes published a headline, “Americans rank a Google internship over a Harvard degree.” It seems higher education is quickly losing hold of its value proposition as the best way to prepare for a job or advance in one’s career.
''independent redistricting commissions'' actually more corrupt
A N.C. company looking to bring a lithium mine to Gaston County is facing pushback from environmental groups, despite a deal already in place to use the mine’s products for electric vehicle batteries.


An assistant director yelled “cold gun” as he handed a prop weapon to Alec Baldwin, which the actor fired, killing cinematographer Halyna Hutchins and injuring director Joel Souza.


Back to Top