JLF Research Archive
Showing items 1 to 25 of 44
North Carolina’s tax code penalizes savings and investment by double taxing their returns— specifically interest, dividends, and capital gains. These biases can only be eliminated by removing savings and investment from the tax base, or by eliminating the returns to saving; for example abolishing the taxation of capital gains.
The governor and Republican members of the state legislature are advocating for a host of new incentive programs and the extension and/or expansion of others. However, these programs are likely to harm consumers, investors, and entrepreneurs who are not privy to the subsidies.
Capital gains taxes penalize saving, investment, and therefore entrepreneurship, by imposing a second layer of taxation on equity investment. The most straightforward way to end this bias is to eliminate the tax on capital gains completely.
North Carolina passed a law during the 2014 legislative session taxing the liquid used in electronic cigarettes at an additional 5 cents per milliliter. This tax will hurt small businesses and violates the most important principle of good tax policy—neutrality. The North Carolina General Assembly should repeal the electronic cigarette tax.
The average North Carolina household in every income category received a tax cut from the 2013 tax reform. Considering both 2011 and 2013 tax changes, the average household in both the lowest and highest income categories is receiving a tax cut of about 1 percent of income.
Over the last several years there have been a great many claims about energy subsidies for both renewables and traditional sources like coal and oil. The analysis hasn't, but should, focus on net subsidies, which includes both subsidies and penalties. The important question is - how are coercive policies distorting supply and demand relative to a free market?
In 2013, North Carolina implemented fundamental tax reform, with changes to personal and corporate income taxes and sales tax. The plan cuts taxes by about $4.75 billion over five years, assuming the state meets certain revenue triggers and implements the plan fully. The importance of reducing tax revenues is that it transfers resources from political to private sector control, enhancing the overall efficiency of how these resources are used.
North Carolina’s state income tax penalizes people’s income generating activities, those that lead to the production of goods and services and spur economic growth. By reducing the rewards to all income-generating activity — work, saving, and investment — the income tax discourages those activities relative to non-income generating activities — leisure and consumption. The tax that should be adopted as a replacement for the existing income tax is what is called a “flat rate consumed income tax.”
North Carolina's corporate income tax should be repealed, not reformed. It violates all basic principles of sound economic policy and open government. It not only imposes a second and even a third layer taxation on many people’s incomes, but it is hidden, dishonest, and inconsistent with informed decision making in a free and democratic society.
Energy efficiency programs focus on the relationship between one input into the production process, energy, relative to the output generated by that process. This simplistic view makes no consideration for the strong possibility that other inputs -- labor, plastic, steal, copper, glass, etc. -- might actually increase. Economic efficiency, on the other hand, relates total costs to the value of the output that those costs generate.
Over the last decade, North Carolina has led the way among southern states in advancing a more extreme environmentalist agenda. The General Assembly's new Republican majority should start anew on environmental issues. Legislators should put environmental policy into the context of the ideas of liberty, personal responsibility, and economic growth that the party ran on last fall.
In 2010, North Carolina recorded the second-lowest number of high-ozone days of the last decade. Statewide, a total of 106 high ozone monitor readings were recorded over 26 days from April 1 to October 31, with 32 of those readings occurring on just eight monitors in two metropolitan areas. Despite what might be the popular belief, smog levels in North Carolina have been getting better, not worse.
Over the past decade the “demand side management” (DSM) model of public policy has crept into the state of North Carolina’s approach to regulation. Advocates of DSM are clear in making explicit their goals of social engineering and the rearrangement of lifestyles. The language in their guiding documents are replete with references to “behavior modification” and “restraining and restricting” certain activities or lifestyle choices. DSM is inconsistent with a free society, where the role of government is to respond to constituent demands, not manage and control them.
Over the past year the focus of North Carolina’s Joint Legislative Committee on Tax Reform has been almost exclusively on whether to expand North Carolina’s sales tax to include services. Following sound principles of tax reform, however, the focus should be on whether the tax base is what economists call neutral, and whether the tax conforms with the principles of justice, rooted in a respect for liberty and freedom of choice. At a combined average state and local rate of 7.98 percent, North Carolina’s sales tax rate is virtually tied with Tennessee’s rate of 8 percent as the highest in the Southeast.
In 2002 the State of North Carolina passed what was officially titled “Improve Air Quality/Electric Utilities,” which became better known as the Clean Smokestacks Bill (CSB). When the CSB was passed in 2002, it was estimated to cost $2.3 billion.
In 2008 the EPA dramatically tightened its standards for defining a high ozone day. Even under EPA’s more stringent new standard, North Carolina — both as a whole and within its major regions — has experienced significant reductions in the number of high ozone days.
Policymakers in the many local governments of North Carolina face a host of important challenges. This issue guide offers solutions to problems that confront North Carolinians at municipal and county levels. The common thread in these recommendations is freedom. By increasing individual freedom, local governments can foster the prosperity of all North Carolinians and keep open avenues to innovative solutions from enterprising citizens.
North Carolina's system of taxation aggressively interferes with individual liberty and retards economic growth. Policymakers should begin to change the tax system.
The Tennessee Valley Authority (TVA) operates 11 coal-fired power plants in the southeastern United States. These plants emit nitrogen oxides (NOx) and sulfur dioxide (SO2), which contribute to particulate matter (PM) and ozone in the eastern U.S., including North Carolina.
North Carolina local government policymakers face many important challenges. This issue guide offers solutions to problems faced by the citizens of the state. The common thread in these recommendations is freedom. By increasing individual freedom, local governments can foster the prosperity of all North Carolinians.
To reach the City & County Issue Guide home page, click here.
This report on sustainable growth is the third in a series of annual research papers from the John Locke Foundation devoted to explaining the principles of free markets and applying them to current controversies in North Carolina.
The Beacon Hill Institute at Suffolk University in Boston, Mass., reviews policies under consideration in North Carolina to cut carbon dioxide (CO2) emissions. Supporters contend those policies would help North Carolina respond to climate change. Supporters also contend the policies would produce positive economic benefits.
This report rebuts the advocates’ economic arguments. Beacon Hill Institute researchers find “serious methodological flaws” in the documents used to justify the climate change policies.
There are three new proposals that would impose hundreds of millions of dollars in new taxes on North Carolinians in the name of fighting global warming. None of these proposals are actually called taxes.
Any recommendations made by North Carolina’s Global Climate Commission this spring will lack much of the underlying analysis required by the Commission’s enabling legislation. Senate Bill 1134, which established the Commission in 2005, was explicit. It stated that the Commission “shall conduct an in depth examination” of a list of important scientific and economic issues. After over a year of meetings the Commission has ignored what any reasonable observer would conclude are the most important questions.
The state of North Carolina levies differing forms of price regulations on a range of what would otherwise be free-market activities. These include controls on wages, gasoline, interest rates, and an unspecified number of prices during disasters and states of emergency. The purpose of this paper is to explain why a free and flexible price system is so important to both social order and the efficient allocation of goods, services, and resources in a free society. Particular emphasis will be placed on North Carolina’s laws meant to regulate prices and the negative effect that these regulations have on both markets and the well-being of the citizens of the state.