NC H396

Authorizes municipalities in North Carolina to levy a one-quarter percent (1/4%) local sales and use tax in addition to existing state and local taxes, subject to voter approval through referendum.

Requires municipalities to hold an advisory referendum conducted by the county board of elections, with the ballot question specifying the tax rate and allowable uses.

Tax proceeds must be used for construction and improvements to public infrastructure and public facilities; affordable housing; economic development; and police, fire, and rescue services.

State Secretary of Revenue distributes collected tax proceeds monthly to each municipality on a net basis, excluding taxes on food exempt from sales tax and certain bundled transactions.

The tax does not apply to food sales exempt under G.S. 105-164.13B or bundled transactions taxable under G.S. 105-467(a)(5a).