S 394 - Lower Tax Rates for a Stronger NC Economy

• Reduces individual income tax rate to a flat 6% with zero tax brackets ($11,000 for married filing jointly, $8,800 for head of household, $5,500 for single filers) while broadening the tax base by eliminating numerous credits and exemptions.

• Reduces corporate income tax rate to 6% (matching the individual rate) and broadens the corporate tax base by eliminating various deductions and credits.

• Replaces the franchise tax with a new business privilege tax of $1 per $1,000 of net worth or investment (minimum $200, maximum $75,000 for holding companies) applicable to all limited liability entities.

• Reduces the general sales tax rate from 4.75% to 4.5% and expands the tax base to include services (property care and maintenance, security services, entertainment and recreation) and digital property while reducing the food tax from exempt to 1%.

• Eliminates numerous archaic state privilege taxes, removes local government authority to impose general privilege license taxes, and adjusts local distributions to compensate for lost revenue from the narrowed franchise/privilege tax base.