Five Ideas on Revenue Modernization for our Newly Elected Officials
Now that the election is over, it is critical that North Carolina’s elected officials get to work addressing the most pressing issue facing our communities and state: how to rebuild a stronger economy after years of job losses and budget cuts. Central to their efforts in the upcoming legislative session will be their decisions around reforming our tax system, which can steer us on a course to a stronger recovery that meets the long-term needs of our communities
As a coalition, we welcome the opportunity to work with the new North Carolina General Assembly as they embark on a critical legislative session that will define the future of our state. Here are five key suggestions we hope our newly elected officials will work on that will support the state’s recovery and help build a stronger economy for all North Carolinians in years to come.
1. MAINTAIN A DIVERSE SOURCE OF REVENUE
A strong revenue system generates funds from diverse sources, which provides some level of stability and the potential for growth with the economy. Overreliance on any one source of revenue can not only make the system more susceptible to specific economic challenges, it can also create unfair advantages for certain groups of North Carolinians at the expense of others.
2. MAKE PROGRESS TOWARDS A MORE EQUITABLE TAX SYSTEM
North Carolina’s tax system is upside down, asking more from those with the least amount of income. This not only is unfair, but it is bad economics – low income families are more likely to spend money in their local communities generating demand for goods and services.
3. INVEST TO MEET THE NEEDS IN COMMUNITIES NOW AND FOR THE FUTURE
Since the start of the Great Recession, budget cuts have diminished our collective investment in communities across the state, which has an impact on the success of individuals and the economy. Hiring enough teachers for our growing K-12 population¸ meeting the need for health care, and protecting the safety of North Carolinians and neighborhoods are all critical to the state’s ability to have an educated workforce, engaged citizenry and healthy and safe communities.
4. REQUIRE THAT PROPOSALS DEFINE WHO WILL PAY
Decisions about how to spend state resources and with what revenues have an impact on North Carolinians and their communities. Depending on the proposals, the outcomes for various groups in our state could be very different. As an elected leader, it is critical that you ask that all proposed tax changes document the impact on different income groups, in particular.
5. ENSURE AN INCLUSIVE AND TRANSPARENT PROCESS
Multiple stakeholders should have a role in identifying the changes needed in NC’s tax system. Providing public comment, participating in open meetings and generally allowing time for the public to respond to proposals are critical to an inclusive and transparent process.