Local Politics

Senate committee looking at broadening state sales tax

Posted April 21, 2009
Updated October 12, 2011

— The state Senate Finance Committee worked Tuesday to finalize details of a proposed change in the state tax structure that would broaden the base of the sales tax and at the same time, trimming it by as much as one percent.

The plan, which could be released Wednesday, would likely reduce the state sales tax from 6.75 percent to 5.75 percent, lower the corporate income tax rate and potentially eliminate the 2 percent grocery tax.

But it would require a sales tax on some non-taxed services, such as landscaping, pest control and home repairs and auto repairs. Professional services, such as legal assistance and accounting would remain tax-free.

Gov. Beverly Perdue has already proposed in her $21 billion budget more than $500 million in additional revenue by increasing the so-called sin tax on alcohol by 5 percent and cigarettes by $1 a pack.

Sen. David Hoyle, D-Gaston, who co-chairs the committee, however, said Tuesday he doesn't think that should be the only new revenue source. Broadening the tax base has been up for discussion for more than 50 years, he added.

"We would be shifting, and we would be broadening," he said. "We're talking about lowering the sales tax potentially a full cent."

Perdue said Tuesday that she believes it is hard to support the idea given the state of the economy but will wait to pass judgment until the official tax proposal is released.

"I think it's a hard time to talk about any kind of broad-based taxes just because of the economy," she said.

Some business owners who would be effected by the tax change, however, said Tuesday they don't like it, because it would cut profits and put a higher tax burden on them..

"It'll hurt my clients' bottom lines, and my bottom line," said Chuck Wright, who owns a commercial lawn maintenance company. "Then, we all have to pass it down. I mean, nothing happens in a vacuum."

"Change is very hard, but it may be time to change," Hoyle said. "I think the long-range benefit for the state would be really, really good."

37 Comments

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  • affirmativediversity Apr 22, 2009

    Why don't they just CUT SPENDING! Bev can do without her 2 Gov Mansions, the private jet and most of the security detail.

    Why should tax payers pay to have her separated and protected from the very people she is suppose to represent.

    Time for politicians to take themselves off that pedestal and start getting their hands mucky with the rest of us!

  • pbjbeach Apr 22, 2009

    IMPEACH BEVE PERDUE PERIOD. THANK YOU

  • x7 Apr 22, 2009

    It is a shame agencies are lobbying against several bills currently the NC legislator that would actually bring in revenue. These bills will require the applicant to pay a fee for the service.
    HOUSE BILL 1445 (Reform Bill of 2009)
    Senate Bill 491 (Expunge for a fee, certain non violent crimes)

    NC Sheriff's Association, and NC Administrative Office of the Courts is against them, BTW.

  • thebull271 Apr 22, 2009

    Ummm.. To get more money shouldn't they cut taxes? People will spend more. Econ 101

  • southrnarchitect Apr 22, 2009

    I thank that all of you that are focusing on a tax reduction better read the article again. Yes a reduction in sales tax but new slaes taxes on work done to your home by plumbers, electricians, HVAC, landscapers, etc. and just think about the tax on those $200, $300, $1000 car repair bills. In my opinion I think it is a time for a Revolution, Another Boston Tea Party,to occur - I am tired of paying more and more taxes and not getting anywhere. Pretty soon the middle class will disappear and it will be the poor and the rich because they are taxing us to death.

  • panthers254 Apr 22, 2009

    i dont think people mind paying their fair share, as long as they understand where their money is going. good schools, better roads and safe communities. as long as the state holds up their end of the bargain, most people wont mind paying their fair share.

  • showed up late Apr 22, 2009

    They need to manage, the money they took from us, better we need to make people accountable! How is that 'striaight party' voting working for you/us now? ....and the Feds have not increased taxes yet, I give it 15 months to two years. Use coupons, barter and grow your own veggies, learn how to blanch and can what you have grown. My 40' x 20' garden will will not get me through the winter but I have only 25 bucks into it and will end up spending less than 80 bucks in seed, fuel and organic fertilizer. I figure, at current prices, it will save me between 600 and 800 bucks over the next 8 months. A side benefit is working a garden is good exercise and you know what you are putting in the bodies of your family.

  • ezLikeSundayMorning Apr 22, 2009

    I'm all for reorganization. And I would love for revenue to be more aligned with the services needed. Just don't try to be sneaky about it.

  • beachboater Apr 22, 2009

    Another democratic sick joke. . A tax increase is a tax increase any way you figure it.

  • rocket Apr 22, 2009

    Thanks to all who helped to vote in this tax and spend Democrat.

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