Lower Income Households Hurt More By Gov. McCrory's Tax Shift
Compared to the 2013 Fiscal Year, the personal income tax is down and the more regressive sales tax is up. This transition from a strong income tax will hinder how effectively the state can support an increasing population.
This tax shift – less reliance on revenue from the income tax and more from the sales tax – is an expressed desire of state leaders. Beginning in 2013, state leaders ushered through huge income tax cuts while expanding the sales tax to include more services. These tax changes have largely benefited the well-off and profitable corporations while shifting the tax load to low- and middle-income families and individuals. The regressive sales tax hits low-income families and individuals particularly hard, as they spend a larger share of their income on goods and services subject to the sales tax. Thus, to point to increased revenue as evidence that low- and middle-income North Carolinians are better off is an inaccurate assessment of reality.