Vice President for State Fiscal Policy
The Tax Foundation’s new chartbook, “North Carolina Illustrated: A Visual Guide to Tax Reform,” showers praise on North Carolina’s recent tax cuts, while leaving out fundamental facts about the harm those tax cuts have caused and the additional damage they will do in the future. North Carolina’s tax cuts shouldn’t be mistaken for “tax reform,” let alone serve as a model for other states.
The state’s recent tax changes:
We agree with some of the Tax Foundation’s analysis, including that states should broaden their sales tax base to include more services (but we disagree about doing this to pay for income and estate tax cuts targeted to the wealthy). We also agree that states should eliminate loopholes in their corporate income tax codes. But it’s wrong to hail these modest improvements while ignoring more fundamental problems with North Carolina’s overall approach — slashing taxes for the wealthy and corporations at the expense of the state’s future.