EDITORIAL: Tax tussle widens gap within General Assembly

Jul. 12, 2013 @ 05:00 AM

Republican lawmakers who sniffed the pleasant political winds after November’s elections are having a different olfactory experience these days. In the eyes of many around the rest of the country, North Carolina stinks — and the legislature is to blame.

We don’t share that sentiment, at least about our state. The legislature, though, is another question altogether. Yep, there’s bad B.O. in Raleigh. Not body odor, but budget obfuscation. And it’s wafting our way.

Among the rest of North Carolina’s problems (outlined in a harsh, deliriously scathing and widely-distributed opinion piece in Tuesday’s New York Times) are the struggles between the Republican-led N.C. House and Senate on tax reform and a budget.

We’re now into North Carolina’s new fiscal year, and by mid-July we all thought we’d see the much-anticipated overhaul of the state’s corporate and personal tax structure. Republicans who were swept into office last fall campaigned on it, made pledges about it, and – with a Republican inhabiting the governor’s chair – seemed destined to be able to make serious headway into making much-needed upgrades to a mostly untouched (in recent years) tax structure.

But a funny thing happened on the way to July 1: GOP political leaders, in charge at the legislature and the capitol, haven’t been able to reach any kind of real consensus on a new tax plan.

By now, lawmakers have recognized (we think) the obvious fact that it’s not so easy to increase the state’s tax revenues AND cut both corporate and personal tax rates simultaneously, and that if you and the governor contentiously disagree about a spending plan, then you won’t end up with a workable budget. As it stands now, the House and Senate tax reform plans are billions of dollars apart because of disagreements about how quickly to reduce taxes and which specific taxes to cut. And with protests raging (there’s more than just the “Moral Mondays” going on in and around the halls in Raleigh) about significant spending cuts in education and some social programs and other reforms, budget discussions haven’t gained traction.

Gov. Pat McCrory was forced into signing a resolution this week creating a new state budget deadline of July 31; he’s telling Republican leaders that he, too, is tiring of the lack of progress. Debate and disagreement is fine, but a full-scale stall isn’t acceptable.

The New York Times may have proclaimed the decline of North Carolina, and again, we wouldn't necessarily go that far. However, it's hard to argue in the face of this tax reform battle and other troubling facts — the fifth-highest unemployment rate in the country, 46th nationally in per-capita education spending, just to name two — that our legislators aren't deserving of some rebuke.