NC S608

Repeals Articles 39, 40, and 42 of Chapter 105 (local sales and use tax provisions) and establishes a new state-administered sales tax distribution system effective July 1, 2016.

Increases the general state sales tax rate from 4.75% to 6.75% and creates a new 2% reduced rate on food (with exceptions for dietary supplements, vending machine sales, prepared food, soft drinks, and candy).

Distributes 29.63% of general rate sales tax revenue plus all food sales tax revenue to counties and cities based on a "hold harmless" baseline (fiscal year 2013-2014 amounts) with any growth allocated per capita.

Requires counties to use 22.5% of received revenue for public school capital outlay or debt service, with option to petition the Local Government Commission for alternative uses.

Establishes a permanent 1/4% county sales and use tax (Article 46) that counties may levy by referendum, replacing previous local tax authorization under repealed articles.