State decision could cost Raleigh $7 million
Posted June 5, 2014
Raleigh, N.C. — A state decision to cut privilege license taxes next year is already generating budget questions for Raleigh City Councilors.
Last week Gov. Pat McCrory signed a tax reform bill that does away with the tax, which businesses pay to operate in cities and towns. Raleigh officials predict that this will hit the city budget with $7 million in lost revenue.
The House version of the bill would have capped the tax at $100, but without consensus between the House and the Senate, no replacement was included. The law will take effect July 1, 2015.
During Monday’s budget work session, Mayor Nancy McFarlane reminded Councilors to keep the lost revenue in mind as they work on next year’s budget.
“We need to plan assuming that we won’t have that $7 million,” she said.
The lack of revenue could pose challenges in following budget years.
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