Leftist Activist Group Ignores Reality, Says NC is “Suffering from Tax Reform.”

This article first appeared at American Lens News on April 18, 2017.

Left-wing activist group Progress NC Action is in serious denial when it comes to NC tax reform judging by their latest “Tax Priorities Tour” email (below).

Progress-NC-Action-Logo

Did you see an increase in your taxes this year? A lot of working families did. That’s why we’re hosting the Tax Priorities Tour in Raleigh tomorrow.

There will be several speakers discussing their experience with tax hikes after the GOP’s tax reform that really cut taxes for millionaires and big businesses. Our lawmakers shouldn’t be giving tax breaks to big corporations and the wealthy when our public schools and teachers are suffering.

Since the General Assembly only cares about big businesses and the top .01%, we must stand up for everyone affected by the GOP’s terrible tax reform. Will you join us at the General Assembly on Tuesday at 11am to set the record straight about how the General Assembly’s tax hikes on working families have made it harder for North Carolinians to get ahead?

Click here RSVP to our event telling the General Assembly their tax hike has made life harder for North Carolinians!

These tax hikes are setting North Carolinians back and are making it harder for us to get ahead. It’s time we let our lawmakers know this is not okay and we will fight back.

Millionaires and big businesses don’t deserve tax breaks, especially when our public schools are still suffering. Republican lawmakers are constantly putting big businesses before education when education should be their main priority.

Help us show lawmakers that North Carolinians are suffering from tax reform by attending our event at the General Assembly!

We hope to see you in Raleigh tomorrow to tell the General Assembly their tax reform is not benefitting North Carolinians!

Sincerely,
Logan Smith
Communications Director, Progress NC

First, it bears mentioning Logan Smith has struggled with basic math in the past.

Second, North Carolina’s personal income taxes have been lowered, not raised. If someone saw an increase, it’s not because of NC income taxes.  Someone either did their taxes wrong or they are making more money than the previous year and have entered a different federal tax bracket.

Mr. Smith and Progress NC Action appear to be using the same Occupy Wall Street theme on taxes that Governor Cooper used in his campaign and the State of the State address where the Governor said that we need, “changes to our tax code need to focus on working families, not corporations and millionaires.”

Both the Governor and Progress NC Action seem to be willfully ignoring the truth about NC’s tax reforms.

NC Tax Reform Truths

North Carolina’s old personal tax rate spanned between 6 and 7.5%. The legislature’s reforms set a flat rate of 5.8% in 2014 and that rate decreased to 5.499% in 2017.

In 2014, North Carolina had one of the highest corporate rates in the Southeast prior to the reforms at 6.9%.

The corporate rate dropped to 5% in 2015 and 4% in 2016. This year, the rate drops to 3%. Those reductions, according to the Tax Foundation, took North Carolina from 44th to 11th in the nation in terms of business-friendly tax climates.

Tax reform in the state wasn’t just about rates, the standard deduction has nearly tripled since 2013.  Prior to 2014, depending on filing status, the standard deduction for most people was $3,000, $6,000, or $4,400. After 2014, those deductions increased to $7,500, $15,000, and $12,000 and continued to increase in the years following

Courtesy of the NC Department of Revenue, here are the current standard deductions for 2016 and the coming deductions for 2017:

N.C. Standard Deduction Amounts for Most Taxpayers:

Filing Status
2016 Standard Deduction 2017 Standard Deduction
Single
$ 8,250
$ 8,750
Married Filing Jointly/Qualifying Widow(er)
$16,500
$17,500
Married Filing Separately
$ 8,250
$ 8,750
Head of Household
$13,200
$14,000

In 2012, NC had the 5th highest unemployment rates in the country, owed $2.8 billion to the federal government, overspent $500 million on Medicaid.  By the beginning of 2017, the state had a $500 million dollar surplus and had added over 300,000 jobs.

In addition to the 2013-14 tax reforms, the legislature made the first $17,500 of family income exempt for the next two years in the 2016 budget.

But wait, there’s more.

In the first week of this month, the NC Senate passed Senate Bill 325, titled the Billion Dollar Middle Class Tax Cut.  The bill also passed the first reading in the House and does the following things:

  • Takes the personal tax rate from 5.49% to 5.35%.
  • Raises the standard deduction again.
  • The child tax credit of $125 has been changed into a decreasing per-child deduction based on income level. For example, married couples filing jointly and earning under $40,000 can deduct $2,500 and the amount drops in increments down to zero for those making over $120,000.
  • Increases the deductions for mortgage interest and property taxes.
  • Drops the corporate tax rate another .5% next year.

But according to Progress NC Action, “North Carolinians are suffering from tax reform.”

A.P. Dillon contributed to this article.

About A.P. Dillon

A.P. Dillon is a reporter currently writing at The North State Journal. She resides in the Triangle area of North Carolina. Find her on Twitter: @APDillon_ Tips: APDillon@Protonmail.com
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