RALEIGH (April 30, 2019) — Once again, House leaders have chosen to cut taxes and reduce our ability to invest in community priorities. Another tax cut for large businesses — this time the franchise tax, which is not a targeted cut for small businesses in NC — will only serve to further erode our tax base and won’t deliver a better economic growth path for our state and families.
The House’s budget proposal leaves our state on an increasingly shakier foundation as many prepare for the next recession. They worked backwards from their arbitrary limit on investments in North Carolina — a limit that has resulted from years of tax cuts for the wealthy few — restricting what is possible for our state.
Tax cuts have failed to deliver an economic boost to our state as we fall behind the region and many states across the country in job growth. Many communities continue to be behind where they were pre-Recession and have lost jobs year over year. Workers have only just started to see their wages grow, and the pace of growth has meant many still struggle to afford the basics like health care and child care. North Carolina’s tax-cut experiment has squandered the national economic recovery.
North Carolina has $3.6 billion less each year to invest in schools, health, and community well-being because of these tax cuts, and even a fraction of that would provide our families with the security of institutions and systems that can fully support our growing state and weather a downturn. And yet, our leaders’ inability to face the fiscal realities of a tax code that will be unable to sustain our collective well-being is hurting our progress toward key goals.
Most notably, House leaders missed the chance in this budget to prioritize the health of every North Carolinian through Medicaid expansion. More North Carolinians with access to health care will reduce budget costs in other areas and that, in combination with accessing the full amount of federal dollars available, will ensure healthier outcomes for families and communities.
As the House budget signals the beginning of budget debate in earnest, it is concerning that the baseline has been set so low and that so many of North Carolina’s priorities will be sidelined because our leaders continue to choose the interests of the rich and big companies over N.C. families.
Our leaders can choose another path and raise the revenue to match our communities’ priorities and address our upside-down tax code. Taking a sustainable approach means every North Carolinian will be able to enjoy the benefits of public investments that support a better future.