— NC Justice Center (@ncjustice) May 30, 2013
Every single member of the General Assembly needs to ask him- or her-self one critical question: how will raising the taxes on 80% of the voting population affect my chances for reelection? While there are definitely more moral questions they should be asking at this time, they've demonstrated a unique ability to ignore such aspects, so the practicality of pissing off a supermajority of the citizens may be the only thing that penetrates those hard heads:
The legislation would eliminate North Carolina’s current income tax bracket, in which people pay higher rates as their incomes rise, and replace it with a zero-percent bracket on the first $11,000 of income and a flat 6-percent rate. It would result in a significant reduction in state revenue from the personal income tax.
The bill also proposes lowering the sales tax rate and expanding the number and type of transactions to which it is applied, and it proposes lowering the corporate tax rate while eliminating some loopholes. Overall, the proposal would result in a tax cut for most high-income taxpayers and a tax increase for many low-income taxpayers.
Contrary to what those who harp about the 47% would like us to believe, the overall tax burden for those in the lower and middle classes is already much greater than that of the wealthy:
The average state’s consumption tax structure is equivalent to an income tax with a 7 percent rate for the poor, a 4.6 percent rate for the middle class, and a 0.9 percent rate for the wealthiest taxpayers. Obviously, no one would intentionally design an income tax that looks like this — yet by relying on consumption taxes as a revenue source, this is effectively the policy choice lawmakers nationwide have made.
The single most important factor affecting the fairness of different state sales taxes is the treatment of
groceries. Taxing food is a particularly regressive strategy because poor families spend most of their
income on groceries and other necessities. Of the ten most regressive sales taxes in the country, eight apply to groceries in some form. A few states have enacted preferential tax rates for taxpayers perceived to have less ability to pay — for example, South Carolina’s sales tax rate is lower for taxpayers over 85 — but these special rates usually apply to taxpayers regardless of income level. Arkansas exempts some utilities for low income taxpayers.
I would dispute that statement, "No one would intentionally design..." I think they would, just as I believe they would deceive their (Tea Party) followers by preaching that we need to become a "low-tax" state, knowing good and well the idea is to simply shift the tax burden onto the backs of those who can least afford it:
This analysis has focused on the most regressive state and local tax systems and the factors that make them so. Aside from their regressivity, however, many of these states have another trait in common: they are frequently hailed as “low-tax” states, often with an emphasis on their lack of an income tax. But this raises the question: “low tax” for whom?
No income-tax states like Washington, Texas and Florida do, in fact, have average to low taxes overall. Can they also be considered “low-tax” states for poor families? Far from it. In fact, these states’ disproportionate reliance on sales and excise taxes make their taxes among the highest in the entire nation on low-income
Washington State, which does not have an income tax, is the highest-tax state in the country for poor people. In fact, when all state and local sales, excise and property taxes are tallied up, Washington’s poor families pay 16.9 percent of their total income in state and local taxes. Compare that to neighboring Idaho and Oregon, where the poor pay 8.2 percent and 8.3 percent, respectively, of their incomes in state and
local taxes — far less than in Washington.
Illinois, which relies heavily on consumption taxes, ranks second in its taxes on the poor, at 13.8 percent. Florida— a no-income-tax state —taxes its poor families at a rate of 13.3 percent, ranking third in this dubious category.
The bottom line is that many so-called “low-tax” states are high-tax states for the poor, and most do not offer a good deal to middle-income families either.
This current tax "reform" debate provides evidence of the stark difference in the ideology of the Left vs the Right. The former understands the need to ease the downward pressure on the lower and middle classes, that is a natural product of a Capitalist system. The latter simply don't care, because they're too busy trying to earn their country club membership.