Tax cuts are starving NC services, but doing little for taxpayers

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In this file photo, the North Carolina House of Representatives is sworn in in the House chamber on Wednesday, January 13, 2021 at the North Carolina General Assembly.

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If an income tax rate drops in North Carolina, does anyone hear it?

Apparently not, according to a blog post from the Carolina Partnership for Reform, a nonprofit that touts the accomplishments of the Republican-led General Assembly.

The group recently published “very good facts on the tax cuts that will benefit North Carolinians following the latest legislation passed in 2021”. One of the “really good facts” is that those earning the state’s median income of $ 50,653 will save $ 131 in taxes in 2022.

But the Carolina Partnership for Reform fears North Carolinians are not celebrating the GOP’s generosity by giving median earners this year what equates to less than $ 3 a week in income tax savings.

Supporters of tax cuts have noticed. The group cites a Tax Foundation blog post welcoming tax cuts in North Carolina, which will cut personal tax rates by nearly half between 2013 and 2027.

Here, the Carolina Partnership for Reform – a virtual spokesperson for the Republican leadership of the legislature – makes a remarkable statement:

“It’s incredible progress. And North Carolina taxpayers should happily celebrate and applaud the good news. But the problem is that NC taxpayers do not know their good fortune! They don’t know that their taxes have dropped drastically!

The group cites polls that ask North Carolina residents whether they are aware that tax rates have come down and lament that “the answer is always ‘up’. Not even “stayed the same”. “

It seems like an accurate assessment. David McLennan, who leads the Meredith College Poll, said in an email he didn’t specifically ask about the state’s tax cuts, but: think they’re okay, and 10 percent think they are too low. I suspect the organization’s claim is correct. North Carolinians have a much broader understanding of taxation and spending than our political leaders realize.

This lack of popular acclaim for the Republican tax cuts, the Carolina Partnership for Reform said, is the media’s fault for not telling people their tax rates have gone down enough. The group urges its subscribers to “pass this blog post on to your friends, colleagues and family and tell them how their taxes have gone down over the past decade.”

But there may be a better explanation why most North Carolinians are unaware of the tax cuts. That’s because the largest share of the cuts went to businesses and the state’s richest 20 percent. Meanwhile, taxpayers have seen sales tax applied to online sales and more services, fees and fines have increased, and urban counties have increased property taxes to make up for insufficient state funding for schools. and services.

State Senator Dan Blue, D-Wake, the Senate Minority Leader, said it’s no mystery why most people don’t celebrate the modest income tax savings. “They are aware that they are spending more than they get on so-called tax breaks,” he said.

Blue said most people would rather their tax dollars were well spent than knee-jerk cutbacks to serve a low-tax philosophy. “People are ready to invest in a quality education system because they see the results far more than they see the benefit of getting $ 131,” he said.

So here we are. After a decade of relentless tax cuts, North Carolina has lost billions of dollars in tax revenue, public schools are struggling, state services are failing, and people who supposedly demanded tax relief. income tax don’t even notice it because they pay more in sales taxes, fees, and local taxes.

The Republican leadership of the legislature is free to bow, but most North Carolinians are holding back their applause.

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The Charlotte Observer and Raleigh News & Observer Editorial Boards combined in 2019 to provide our readers with more comprehensive and diverse opinion-oriented content on North Carolina. The Editorial Board operates independently of the Charlotte and Raleigh newsrooms and does not influence the work of the reporting and editorial teams. The Combined Board of Directors is chaired by NC Opinion Editor-in-Chief Peter St. Onge, who is joined in Raleigh by Opinion Associate Editor Ned Barnett and Opinion Writer Sara Pequeño and in Charlotte by Pulitzer Prize winning cartoonist Kevin Siers; and opinion piece writer Paige Masten. Board members also include McClatchy’s Vice President of Local News Robyn Tomlin, Observer Editor Rana Cash, News & Observer Editor Bill Church and longtime News columnist. & Observe Barry Saunders. For any questions about the board or our editorials, email [email protected]