June 10, 2013
The tax reform discussion in North Carolina continues and has heated up significantly in the past few weeks. Tax reform bills started coming out back in March and continued until late last month, with the most recent being Senate Bill 677.
There are five primary plans currently in play, some from each part of the legislature and representing both political parties:
1. Senate Bills 363 and 677, which are companion bills. It should be noted that a Proposed Committee Substitute has been presented for 677, which takes a more comprehensive look at NC’s taxes; it started out addressing only corporate income tax.
2. Senate Bill 394, now Edition 2.
3. House Bill 961.
4. House Bill 985.
5. House Bill 998, which was replaced with a Proposed Committee Substitute and is now on Edition 3, having undergone some changes along the way.
Given all the political theatre over tax reform just this week, it is helpful to take a step back and remind ourselves why this debate is going on in the first place – because of North Carolina’s revenue problem. It is clear that our revenue streams are unreliable, making it difficult for our state to budget for the basic services our citizens depend on. Economists and other experts agree that unless we reform our tax code in a meaningful way, our state will be unable to afford those services in the near future.
There is a lot of confusion, uncertainty and even misinformation out there. The NC Association of CPA’s Tax Modernization Task Force, of which JPS shareholder Rollin Groseclose is Chair, has worked to provide guidance and insight to educate the public on the tax reform debate. Helpful information, as well as a thorough summary analysis of the current and proposed tax laws, can be viewed at www.tarheeltaxreform.com.