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There was a time in North Carolina in the 20th Century in which the corporate income tax funded a large share of the state budget.
Not anymore.
Thanks to repeated cuts over the decades – and especially in recent years as Republican lawmakers have moved to completely end the tax – more and more of the responsibility for funding government has fallen to low- and middle-income individuals.
And this is precisely the wrong way our state should be heading.
As analysts at the North Carolina Budget and Tax Center have repeatedly pointed out, most small businesses are already exempt from the corporate income tax and those subject to it tend to be large and highly profitable multi-state corporations.
Now add that corporate income taxes are mostly passed on to affluent shareholders or to highly-paid executives, many of whom live outside of our state, and the wisdom of retaining and strengthening the tax becomes obvious.
The bottom line: North Carolina’s tax code is already deeply regressive. Phasing out the corporate income tax as is currently planned, will only make things much worse.
For NC Newsline, I’m Rob Schofield.