In his Daily Journal, John Hood explains why paying any tax is a big deal that has long-term consequences. And right now, as state budget writers put together a budget plan, it’s important to compare the impact of the tax policies imbedded in the recently passed N.C. House budget and in Gov. Perdue’s plan.
• Tax policies associated with the House budget plan will create 14,000 private-sector jobs in 2012 and 16,000 in 2013. Subtract the 7,000 public-sector layoffslikely to result from the budget, and the Republican plan is a net job creator.
• The tax policies associated with the Perdue budget plan will create about 3,000 private-sector jobs next year, which is about the same number as the public-sector layoffs in her plan. The Perdue plan is not a net job creator.
• The House’s individual income tax and sales tax changes would increase real disposable income by $1 billion million in 2012 and $1.5 billion in 2013. The corporate income tax changes would reduce the tax burden on capital investments. As a result, both local and out-of-state businesses would find investment more attractive in North Carolina. Private investment will increase by just over $600 million in 2012, increasing to $1 billion in 2013.
