Local News

Sales Tax Increase Could Be Solution To Rising Medicaid Costs

Posted February 16, 2006

— When you shop in Wake County, you pay seven cents in sales tax. The tax could go up to eight cents.

A proposal from the North Carolina Association of County Commissioners asks the state to take over their Medicaid payments. Right now, North Carolina is the only state that requires counties to pitch in on Medicaid -- which will cost a half-billion dollars this year.

"What we would like No. 1 is Medicaid relief. The state has indicated it won't take it over without some sort of revenue swap," said Rebecca Troutman, of the North Carolina Association of County Commissioners.

In return, the state would allow counties to enact an additional penny sales tax.

"Anyway, you look at it, you are going from a 7-cent to a 8-cent sales tax -- it's a tax increase," said Wake County Commissioner Joe Bryan.

Supporters said whether the state takes over the payments or not, extra money for Medicaid has to come from somewhere.

"Your taxes will go up regardless. Right now all we have is the property tax to support Medicaid. Our property tax base is going up 8 percent. Medicaid is going up over 10 percent, so immediately, you have a difference there," Troutman said.

The North Carolina Association of County Commissioners will meet Thursday to discuss the issue. The Wake County Board of Commissioners have already said that they are against the proposal.


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