Tax and spend Tax and spend Tax and spend

Democrats’ Massive Tax Increase Proposals
“The Dirty Dozen”

Raleigh – House Republican Leader Paul Stam (R-Wake) and Senate Republican leader Phil Berger (R-Rockingham) discussed some of the most egregious tax and fee increases in the proposed Democratic budget. House and Senate members discussed the negative effects of these “Dirty Dozen” taxes and fees on our state’s fragile economy and their impact on families.

The “Dirty Dozen” include:
Estimated Revenue Generated:
2009-2010 2010-2011

A. Increase Upper-Income
Tax Brackets: $256,700,000 $183,100,000
Presented by: Rep. Dale Folwell (R-Forsyth)
· Jobs “killer” – Employers move to other states
· Disincentive for new economic development - employers
· Wrong prescription during recession

B. Increase Sales Tax
Rate ¼ cent: $195,000,000 $200,000,000
Presented by: Rep. Paul Stam (R-Wake)
· Regressive, greatest burden on lower income citizens
· Nondeductible against Federal Income Tax - $30 million/yr. gift to Washington, DC

C. Sales Tax on Repairs,
Installations, Warranties: $176,200,000 $244,000,000
Presented by: Rep. Nelson Dollar (R-Wake)
· Harmful to small businesses
· Burden on consumers who can afford it least

D. Sales Tax on Digital/
Click Throughs: $13,200,000 $17,800,000
Presented by: Rep. Marilyn Avila (R-Wake)
Harmful to economic recovery
Amazon has threatened to pull out of NC. If so, we will receive less revenue
Probably unconstitutional

E. Sales Tax on Local
And Interstate Courier Services: $25,000,000 $91,000,000
Presented by: Rep. Darrell McCormick (R-Yadkin)
Costs passed on to consumers/small businesses
FedEx is losing money
Tax ‘em “coming and going”

F. Franchise Tax on LLCs: $59,000,000 $131,000,000
Presented by: Rep. Thom Tillis (R-Mecklenburg)
· Inhibit growth of new jobs (most small businesses are LLCs)
· Tax applies even if LLC is losing money
· In many cases, this duplicates property tax

G. Sales Tax on
Amusements/Movies: $23,600,000 $31,600,000
Presented by: Rep. Hugh Blackwell (R-Burke)
Amusements/movies are all business for those in that business
Regressive, nondeductible

H. Increase Fees for Deeds of
Trust and Mortgages for
Emergency Mgmt Division Use: $1,780,093 $3,560.186
Presented by: Rep. Pat Hurley (R-Randolph)
Fee completely unrelated to Emergency Management
Why are borrowers singled out for this fee when those who pay cash for a home pay nothing?
A person who borrows $10,000 pays same $9 as one who borrows $1 million

I. Increase Marriage License Fee: $648,680 $648,680
Presented by: Rep. Mark Hilton (R-Catawba)
Burden on families at the time of life when they are least able to pay
Funds Domestic Violence – But it does not tax those “shacking up” or those married 30 years who are abusing a spouse or “partner”
Insulting to newlyweds to presume they will abuse each other

J. Radiation (X-Ray)
Inspection Fee: $416,282 $813,242
Presented by: Rep. Bill Current (R-Gaston)
Increase medical costs
No evidence of need for new inspections

K. Electricity Tax: $273,500,000 $337,800,000
Presented by: Rep. Wil Neumann (R-Gaston)
Regressive, nondeductible
Tax on all electric consumers – residential and business
Harmful to stressed families in time of recession

L. Pick Your Own $? $?


“Adoption of a state budget that adequately funds North Carolina’s priorities does not require busting the budgets of North Carolina’s families and businesses,” said Sen. Phil Berger. “Now is the time to break the cycle of tax-and-spend policies embraced by North Carolina’s Democratic leaders. Legislative Democrats should not expect North Carolina’s citizens and small businesses to pay the price for Democratic mismanagement.”