Real Tax Reform Needed for a Bright Future | Eastern North Carolina Now

    Publisher's note: We are please to add the words of North Carolina Senator Thom Goolsby to our stable of right-thinking and most capable writers here at BCN. Senator Goolsby, a practicing lawyer from New Hanover County, is a competent voice for victim's rights, and a strong voice for the rule of law, in North Carolina's upper chamber. We wish him much success, and we thank him for his wise words to our reader here Downeast and beyond.

    High taxes have stifled North Carolina's economic growth for decades. The Tar Heel State has the highest taxes in the Southeast and ranks 44th as the worst state in the country for business, according to the Tax Foundation.

    In the years running up to the Great Recession, neighboring states grew two to four times as fast as North Carolina. Due to higher taxes, our state has been forced to offer tax incentives in order to lure businesses here. Time and time again, when the incentives run out and the companies face paying North Carolina taxes, they leave or demand more tax breaks to stay. The math is simple for businesses - it costs too much to operate in our state.

    Our current tax code was written during the Great Depression for an agricultural-based economy. Over the years, the tax system became riddled with exemptions and loopholes so politicians could pick winners and losers. This type of "good ole boy" mentality benefited lobbyists and special interests, but it did so at the expense of small businesses and working families.

    The good news is that the North Carolina Senate has offered a new plan. It moves in the opposite direction of the past by simplifying the tax code and wiping out hundreds of the special interest loopholes. The goal is to make the tax system fair to everyone.

    Not only does the Senate plan reform the tax code, it also updates the code, spurring our economy to attract 21st-century jobs. It is also structured to place more money into the pockets of hard-working families and job-creating businesses by reducing tax rates, as well as taxes. In just five short years, the plan puts over one billion dollars back into the pockets of working families and encourages job growth by providing tax relief to job-creating businesses.

    Best of all, it's simple. The first step is the phasing out of North Carolina's personal income tax. Off the top, the current maximum 7.75 percent income tax is slashed 30 percent to 5.4 percent in 2014 and then to 5.25 percent in 2015. The food tax is phased out and eliminated by 2016. The death tax is abolished.

    A new zero percent income tax bracket is created for all families for the first $15,000 of income, while keeping the child tax credit in place. Corporate income taxes immediately begin being phased out and will be eliminated by 2017. The business franchise tax and local business privilege taxes will be abolished by 2018.

    How can the state afford these tax cuts? It's quite simple - the plan holds the line on spending increases in the future. The out-of-control growth of government must stop in order to control spending and for any tax plan to work. Further, the plan establishes and funds the key priorities of education, public safety and roads.

    For years, free-spending politicians blew every dime in the state treasury, borrowed all the money they could and increased taxes. This type of mentality drove North Carolina to the edge of bankruptcy just three short years ago. After much hard work, the state has been put on sound financial footing, but now we must get competitive. High tax rates are killing North Carolina's ability to compete with surrounding states, attract good jobs and grow our own businesses. The new Senate plan offers a common sense, well thought-out solution. It is our best hope for a bright future for the Tar Heel State.