RALEIGH - North Carolina's legislative leaders have little appetite for new taxes this year, but their view of the state's tax burden -- particularly for businesses -- appears to fall along party lines.

At a meeting of the state's top business lobbying group Wednesday, House Speaker Joe Hackney said North Carolina ranks consistently among the top states for a low tax burden on business.

Hackney, a Democrat, made the comments after Senate Minority Leader Phil Berger, R-Rockingham, told the crowd at the N.C. Chamber's Government Affairs Conference that the state's corporate income tax rate of 6.9 percent and top individual income tax rate of 7.75 percent remain the highest in the Southeast.

Lowering taxes won't happen until the state reduces the rate of growth in its budget, Berger said.

"We can't do that as long as we continue to spend at the rate that we spend," he said.

Year-over-year increases in the state spending plan have grown close to 10 percent each of the last two years.

Easley's $21.5 billion budget proposal for the year starting July 1 would increase spending by 4.2 percent. House and Senate members are now reviewing it and drawing up their respective plans.

A report released Wednesday by legislative fiscal analysts to House-Senate budget committee members said lawmakers will have about $485 million available to adjust the second year of the two-year budget for things such as state employee salaries, teacher bonuses and other needs.

That includes a revenue surplus of about $150 million and other money unspent during this fiscal year.

Hackney, who followed Berger on the program, said a report released last month by the Council on State Taxation shows North Carolina's business climate is great. The report found the state ranks third-lowest in the country when it comes to state and local taxes as a percentage of gross state product in the private sector.

"The figures quoted by Senator Berger are correct, but they are not the whole story," Hackney, D-Orange, said at the Marbles children's museum in downtown Raleigh.

"Our fiscal stability in North Carolina is good," he added, pointing out the $800 million in the state's rainy-day reserve fund. "We have protected our fiscal house. It is in great shape."

Easley's budget also recommended raising taxes on cigarettes and alcohol to pay for 7 percent teacher raises and mental health program improvements.