North Carolina Senate gives final approval to $2 billion tax-cut plan
Legislation that includes more than $2 billion in tax reductions over the next two years and the phaseout of North Carolina’s corporate income tax by 2028 received bipartisan approval again in the Senate on Thursday.
The Republican-authored measure, which also would send up to $1 billion in federal COVID-19 recovery aid to hundreds of thousands businesses and nonprofits, already received the Senate’s initial OK on Wednesday. Seven Democrats joined all Republicans present in voting 34-13 for the bill on Thursday.
The bill now heads to the House, where action isn’t expected. Rather, the Senate will insert the package in its state government budget plan later this month and negotiate it with the House after that chamber approves a competing tax and spending proposal.
The Senate plan would reduce the individual income tax rate of 5.25% to 4.99% next year, and increase the amount of income not subject to taxes for all filers by increasing the standard and per-child deductions. The corporate rate — currently the lowest among those states that have such a tax at 2.5% — would start falling in 2024.
Democrats opposing the bill say it would give tax breaks to out-of-state corporations and high wage-earners that don’t need them.