Local News
3:09 pm
Fri June 7, 2013

N.C. House Moves First On Tax Overhaul

Credit Alan Cleaver / Flickr

The North Carolina House tentatively passed its version of a tax overhaul Friday. The Republican bill is one of three major tax overhauls the General Assembly is considering. 

Republicans and some Democrats in the state legislature agree North Carolina needs to do something about its tax code. The current one is based off a model from the Great Depression, and it includes the highest income tax rates in the Southeast.

The House is set to pass its solution first. It's a Republican bill that junks the state's three-tiered income tax system and replaces it with a flat one. Instead of paying an income tax rate of either 7.75 percent, 7 percent or 6 percent, everyone would pay 5.9 percent.

The bill also expands the sales tax to cover things like car repairs, property maintenance and museum tickets. It does not tax medicine, food or social security benefits – all of which would get taxed under the Republican plan in the Senate.

House members expect to give their bill final approval on Monday. After that, it'll be the Senate's turn to decide what's next for the North Carolina tax code.