North Carolina
What's New
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ITEP Work in Action
October 22, 2018NC Policy Watch: North Carolina’s Tax Code Isn’t Helping the State’s Growing Inequality
Despite claims by the architects of North Carolina’s failed tax-cut experiment, policy choices since 2013 have not ensured that middle and low-income taxpayers are paying lower shares of their income…
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ITEP Work in Action
October 17, 2018NC Policy Watch: Low-income Tax Payers in NC Pay More of Their Income in State and Local Taxes Each Year Than the Richest Taxpayers
Sales taxes play a critical role in the regressive and consequently inequitable nature of the North Carolina tax system. Like most other states, North Carolina relies on sales and excise…
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ITEP Work in Action
September 28, 2018BTC Report: Income tax rate cap amendment is costly for taxpayers, communities
Imposing an arbitrary income tax cap in the North Carolina Constitution could fundamentally compromise our state’s ability to fund our schools, roads, and public health, as well as raise the cost…
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ITEP Work in Action
May 31, 2018NC Budget and Tax Center: Corporations over Carolinians?
Big corporations and wealthy executive have been on quite a run. Corporate profits are at historic levels,[1] stock prices are through the roof, and plush executive pay has become the… -
ITEP Work in Action
May 30, 2018NC Budget and Tax Center: Revenue Options to Support Children’s Educational Success
The General Assembly legislative session begins on May 16, the same day teachers plan a day of action to highlight the unmet needs their students face in the classroom and… -
ITEP Work in Action
May 22, 2018NC Policy Watch: Governor Cooper recognizes North Carolina is in a hole, stops digging
Holding off on another round of tax cuts for the richest taxpayers and profitable corporations and keeping the increased standard deduction and lower rate for the majority of taxpayers will…
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blog
May 22, 2018Most States Have Raised Gas Taxes in Recent Years
State tax policy can be a contentious topic, but in recent years there has been a remarkable level of agreement on one tax in particular: the gasoline tax. Increasingly, state… -
blog
May 15, 2018NC Teachers’ March on Raleigh and the Tax Cuts that Led Them There
Once again, public school teachers are taking a stand for education and against irresponsible, top-heavy tax cuts that deprive states of the revenue they need to sufficiently fund public services,… -
ITEP Work in Action
April 16, 2018NC Budget and Tax Center: North Carolina’s Upside Down Tax Code
Tax season comes to a close this week, and Tax Day serves as a good time to reflect on who pays taxes in North Carolina. The income tax is, naturally,…
Related Resources
ITEP Publications about North Carolina
Reports about North Carolina using ITEP data
All items referencing North Carolina
By the Numbers
| Personal Income Tax Features | |
|---|---|
| Range of Tax Rates | 5.75% |
| Standard Deduction |
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| Personal Exemption | None |
| Dependent Exemption | None |
| Earned Income Tax Credit (EITC) | None |
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| Corporate Income Tax Features | |
|---|---|
| Range of Tax Rates | Provides child tax credit that phases out for upper-income taxpayers |
| Income Level at Which Top Rate Applies | Limits itemized deductions to $20,000 of property tax and mortgage interest plus unlimited charitable contributions |
| Combined Reporting | 5.00%, eventually falling as low as 3% by 2017 |
| Apportionment Factor (Payroll) | All |
| Apportionment Factor (Property) | No |
| Apportionment Factor (Sales) | 25% |
| Sales Tax Features | |
|---|---|
| State Sales Tax Rate | 4.75 |
| Average Local Sales Tax Rate | 2.15% |
| Average Combined State & Local Sales Tax Rate | 6.90% |
| State Sales Tax Treatment of Groceries | Exempt |
| Local Sales Tax Treatment of Groceries | Taxed |
| Number of Services Taxed | 57 out of 168 surveyed (2007) |
| Streamlined Sales Tax Membership | Full |
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| Property Tax Features | |
|---|---|
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| Other Tax & Revenue Features | |
|---|---|
| Gasoline Tax Rate (per gallon) | $0.378 |
| Diesel Tax Rate (per gallon) | $0.379 |
| Cigarette Tax Rate (per pack) | $0.45 |
| Estate or Inheritance Tax | No |
| Net Lottery Sales Per Capita | $139 (2010) |
| Tax Policy Oversight | |
|---|---|
| Tax Expenditure Report | Yes |
| Tax Incidence Analysis Capability | Personal income tax only |
Last updated January 13, 2015
RESOURCES
State Tax & Revenue Information
- North Carolina Department of Revenue Reports and Statistics
- North Carolina Office of State Budget and Management