Group Urges Reforms Of Sales Tax

Sep 28, 2012

A new report from the North Carolina Budget and Tax Center says it’s time for the state to collect a more reliable revenue source than the sales tax.

The sales tax is 30-percent of North Carolina’s total tax revenue – that’s about six billion dollars.  But – the non-profit Budget and Tax Center says the state needs to broaden its tax structure.  Alexandra Sirota is director of the Budget and Tax Center. She says it’s time to tax services to help raise revenue instead of counting so heavily on material goods.

Alexandra Sirota continues, "That would better align the sales tax with, like I said, the consumption patterns. People are today buying more services than they are goods.  They are not buying records anymore, but down-loads of music."

The report also calls for devising a program similar to the Earned Income Tax Credit to help prevent low-income taxpayers from paying too large a share of their income in sales tax.