Readers weigh in on Perdue tax proposals

Readers of Sunday's column on the state budget shortfall noticed that a url link to Gov. Bev Perdue's proposed tax changes wasn't working, so here's a link.



Look on the third page for the 37 tax changes she suggested the legislature consider. Meanwhile, readers weighed in:

A Statesville reader wrote:

I have not seen any empirical data to support my opinion but I feel quite sure if the legislature were to add the service industries sector to the sales tax base, the sales tax rate could be reduced and probably give the citizens of NC a reduction in their income tax rate as well. Many other states in which I have had personal dealings, SC for one, have long charged a sales tax on services rendered. In one sense of the word, it is user friendly. If you don't buy the item, you don't incur the tax or in this case if you don't want the service you don't have to pay the tax.
The citizens of NC have a large enough tax burden as it is.

To add another 1 cent along with one of the highest state income burdens in the country is not right. Just as is not right to be building a $25,000,000 pier and taking over $100,000,000 from the Clean Water Management Trust Fund to be used for general budget needs. We need to get it right in Raleigh. There have been too many years of the "good ole boy" network getting a pass. I trust you will use your pulpit to ferret out the wrongs of the past and see that all citizens of this great state get fair and equitable treatment.

A good example of the unfairness is the fact we have no roads in the Charlotte Metro area. If the folks in Raleigh had this problem, they would go crazy. I hate to say this, because it would certainly tend to divide, but the folks from Greensboro to Charlotte need to come together to break the grip that eastern NC has on the politics, influence, and flow of money in this state.

We used to have good government in the days of Skipper Bowles, and the legislature was responsible in its fiduciary capacity to its citizenry. That is no longer the case. It is now all about special interest and not what is best for the state as a whole. North Carolina used to be looked at as a beacon, our light no longer shines.

And a Charlotte reader wrote:

It seems uncanny the way recent North Carolina governors time their inaugurations to coincide with budget disasters. At this point, the Governor and the General Assembly may have no recourse but to raise the income and sales tax rates. Doing so would be much less harmful than laying off more teachers.

I believe, however, the GA (though, of course, not Governor Purdue) at one time had available at least one option that could have averted much of the current fiscal disaster. Back in 2003 the GA could have bought an insurance policy against budget shortfalls by paying a relatively (relative to the current shortfall) small premium each year into North Carolina's Rainy Day Fund. The Fund was anemic, even before the Governor and GA withdrew funds last fiscal year. Back in 2002 the Governor's Commission to Modernize State Finances included a report providing evidence of the problem (copy attached). You may recall that one Commission recommendation called for a sizable increase in the Fund.

If the GA had increased Fund contributions back in 2003, North Carolina would be in a much better fiscal position this biennium. Probably many fewer teacher layoffs would have been necessary. It is hard not to think how much better off we would be today, had the GA taken the Commission's recommendations to heart.