Politics & Government

Like your tax rate? Republicans want to make sure it can't go higher.

. Bloomberg

North Carolina voters may soon get a chance to limit legislators' ability to raise their income taxes.

The state Constitution caps the personal income tax rate at 10 percent, but taxpayers pay about 5.49 percent after Republican tax cuts, and next year another tax cut is set to kick in in that will drop the rate to 5.25 percent.

Now, some GOP lawmakers want to prevent the legislature from ever raising the rate above 5.5 percent.

A proposal to put the idea of a constitutional amendment on the November ballot cleared its first procedural obstacle on Wednesday afternoon when it received a favorable recommendation from the House finance committee — with votes falling along party lines.

State Rep. Graig Meyer, a Democrat from Orange County, opposed the move on the grounds that it would ultimately hurt low-income residents by requiring more regressive taxes.

"When the state or counties need additional resources in times of crisis ... the taxes that will get raised are property taxes, sales taxes and user fees," Meyer said. "It will shift the tax burden to the people who are already in a situation to be the hardest hit."

State Sen. Tommy Tucker, a Republican from Union County and one of the bill's sponsors, said income taxes aren't as easy to collect during economic downturns. He referred to a time after the last recession when Democrats controlled state government.

"There are many (tax) options if the legislature chooses to go in that 'spend everything we have mode' again," Tucker said, nothing alcohol and tobacco taxes.

The move was applauded by conservative groups, including Americans for Prosperity.

"North Carolina has made huge economic improvements in the last five years as a result of controlled spending and continual tax cuts that increase fairness and level the playing field for all businesses," said Anna Beavon Gravely, the deputy state director. "This amendment lets voters solidify the progress while encouraging lawmakers to continue with landmark economic prosperity."

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This isn't the first time legislators have proposed a constitutional cap on the income tax rate. Last year, the state Senate gave its approval to a similar idea. But the House didn't support it last year.

This year's effort comes days after a Civitas Institute poll found broad support for the idea, and ahead of November elections. Two-thirds of people responding to the Civitas poll supported the potential amendment, while 13 percent opposed it and 21 percent weren't sure.

Every seat in the legislature is up for election, and Democrats hope to break the Republican supermajority.

Republicans hope to get voters to the polls by putting referendums on the ballot. In addition to asking voters to approve an income tax cap, Republicans have proposed a constitutional amendment requiring voter ID.

If either referendum makes it to the ballot and earns voter approval, it would take three-fifths supermajorities in the legislature and another voter referendum to reverse either law.

Specht: 919-829-4870 @AndySpecht