Five Strategies for a Fiscally Responsible Budget

North Carolina’s ability to compete and thrive in a dynamic 21st century economy requires a tax system that raises adequate revenue for public investments that promote broadly shared economic prosperity. Five years into a national economic recovery, North Carolina has failed to achieve financial stability. The slow pace of job creation is one reason, but the major cause is the reduction in revenue that resulted from the 2013 tax plan passed by state lawmakers, which largely benefited well-off North Carolinians at the expense of middle- and low-income earners.

In the first 100 days of the legislative session five strategies should be at the top of policymakers’ agenda to ensure a financially responsible biennial budget is put in place. The following five revenue options should be on the table to close the anticipated gap between state revenue and what we need to fund education, health and other building blocks of a strong economy.

The five strategies are:

1. Restore an income tax rate structure that ensures that all taxpayers carry an appropriate share of the tax load.
2. Restore a vital tax credit for low-income working families before any further expansion of the sales tax.
3. Make sure that large, profitable corporations are paying to support the services they use and enjoy.
4. Eliminate special-interest tax breaks that aren’t helping the state’s economy.
5. Avoid short-sighted budget cuts and the sale of state resources.