Public Policy Update: Tax Modernization

April 5, 2013
One of the Chamber’s top legislative priorities for 2013 is tax modernization for North Carolina. You can see the Chamber’s position statement on tax modernization here.
The NC General Assembly continued work on tax modernization this week with work on several bills. The first bit of action occurred early in the week as Senate Finance debated SB363-Business Tax Reductions & Reforms. The legislation would repeal the existing corporate franchise tax and replace it with a state business privilege tax, which would be paid by all business with limited liability. The legislation would require LLC’s to pay the new privilege tax at a rate of $1.35 per $1,000 of the entity’s net worth tax base. The bill would also eliminate the state and local privilege taxes, which has been a major concern for the City of Asheville.
The theme of tax modernization continued on Wednesday with two pieces of legislation being introduced in the Senate. The first bill introduced was SB669. This bill would work to decrease the personal income tax rate in North Carolina to 4% by 2016. However, it has been said that this bill is merely a placeholder and that more sweeping changes can be expected in the next couple of days. The Chamber will make sure to keep you up-to-date on any changes introduced in the bill.
Finally, SB677was also introduced on Wednesday in an attempt to address North Carolina’s corporate income tax. The bill aims at reducing NC’s corporate income tax to 6% by 2015. This legislation will begin its path through committees next Tuesday.
The Chamber will continue to watch as changes are expected to be made to the legislation to address the taxation of services. Please contact the Chamber with any questions or concerns on the topic at jjoyce@ashevillechamber.org.