Tax reform proposals are bubbling up in a number of states across the country as elected officials look for ways to stimulate the state’s economy or revamp outdated tax codes. Sometimes, a key element gets lost in the debate: What’s fair.
Right now, in North Carolina, state leaders are working on a variety of proposals that would force North Carolinians to pay new taxes on the things they count on most. This includes the basics of everyday living, like:
- Social Security
- Prescription Drugs
- Protect North Carolinians’ health and financial security – not threaten it.
- Help businesses to create jobs and strengthen the state’s economy without unfairly burdening taxpayers.
- Reflect the values of North Carolinians, promoting personal responsibility and limited government.
Bottom line: Piling on more taxes isn’t the answer. Other states that have slightly lowered the income tax and stuck new taxes on goods and services have not seen the boost in jobs or the economy that they promised.
However, these facts remain in North Carolina:
- 80% of low- and middle-income seniors rely on Social Security as their sole source of retirement income. Their average yearly benefit is $14,000.
- At the same time, these seniors spend 14% of their monthly income on prescription drugs and other out-of-pocket health care costs.
- North Carolina also ranks among the worst states when it comes to adult hunger. One out of every 10 North Carolinian over age 50 is “food insecure,” meaning, they risk going to bed hungry every night.
AARP North Carolina State Director Doug Dickerson said, “Food, prescription drugs, and Social Security aren’t luxuries – they are the essentials of daily living. Seniors can’t afford to pay unnecessary taxes on these basic necessities – a fact recognized by most other states in the country. Today, only 10 states currently tax groceries, while only Illinois taxes prescription drugs.”
Just this week, Missouri Governor Jay Nixon vetoed a tax bill that would impose a new tax on prescription drugs.
The trend of shifting taxes away from income and towards the sale of goods and services emerged out of the Heartland last year, with a major proposal introduced in Kansas.
- The promise: Shifting taxes will create jobs.
- The reality: Adding new taxes does nothing to boost jobs or the economy. But, it does jeopardize the ability of seniors and hard-working families to pay their bills and pump money into the economy.
Stay tuned as the tax reform debate continues in North Carolina – and other states across the country.