Revenue forecast shows NC leaders have a choice to put people first

The state revenue forecast for NC is out. It’s good news for NC if the NC General Assembly chooses to use our public dollars for the public good in the upcoming session.

The pandemic made clear that we need to invest more in housing, public health, childcare, and education be able to handle a public health and economic crisis like COVID. When we don’t invest in those things, we risk leaving communities behind. More than half of NC counties have fewer people working than before COVID; many of those never recouped what they lost in the Great Recession.

Doubling down on austerity in the face of abundance would be an unpopular and economically harmful approach for NC.

With $4.2 billion more in the current fiscal year than expected and $1.9 billion more in next fiscal year, NC can afford to pay for what people need to be healthy and thrive.

Federal aid sped up jobs recovery, which drove up sales and income tax collections, in turn boosting NC’s revenue, according to the forecast.

With inflation concerns, it is increasingly important for policymakers to address the effects of the sales tax on those with lower incomes, with refundable credits like the Earned Income Tax Credit.

The richest taxpayers in NC benefited from another notable trend, according to the revenue forecast: “record-breaking stock market returns and corporate profits”.

Part of what drove the bump in collections this year was record-breaking corporate profits. If the NCGA doesn’t reverse its plan to eliminate the corporate income tax, the next time big corporations have a big payday, NC residents will get left out.

In addition, tax breaks for the very rich will only grow after last year’s decision to phase down income tax rates and eliminate the corporate income tax on profits entirely.

Failing to hold inequality in check and cutting off the capacity to strengthen our economy’s foundation, puts NC at future risk. Hardship will persist, generating wide-ranging negative impacts on entrepreneurship, education, and community stability.

While the revenue forecast suggests caution in future years due to inflation and recession possibilities, what NC really needs to worry about is public money disappearing as tax cuts for the rich and corporations phase in.

This year, North Carolina leaders have another chance to make a different choice — a choice that puts the people of this state first by spending public money on what everyday people need to be healthy and thrive.