New Year means bigger sales tax bite
Published December 27, 2013
by Laura Leslie, WRAL, December 26, 2013.
While many North Carolinians might take home a little more of their paycheck next year, they will likely be spending more of it as well.
Lawmakers passed a major tax reform package in July that lowers state income tax rates while also eliminating some deductions and adding sales tax to some new items.
The changes mean that, starting Jan. 1, people will pay 6.75 percent sales tax on tickets to movies, concerts, college and professional sporting events and attractions such as Marbles Kids Museum in downtown Raleigh.
"My son loves it, so I'll pay it," Tiffany Barnes said Thursday of the added 35-cent tax on a $5 admission to Marbles.
Beth Carmichael and Martell Walker agree that the tax will add up, but it won't stop them from going places like Marbles.
"A 35-cent hike, I think that people will notice that, but I will still bring (my family) because we only come one or two times a year," Carmichael said.
"Taxes are taxes, you know. If it's only going to be 35 cents, that's not bad," Walker said.
Elizabeth Negra, however, said adding sales tax to ticket prices is too much.
"I feel like they're already expensive enough, so why add taxes on it?" Negra said.
Other changes under the law add taxes to newspaper subscriptions – home delivery of The News & Observer in Raleigh will cost an extra $21 – and service and maintenance contracts for cars, computers and new appliances.
Lawmakers also ended the annual tax-free weekend for back-to-school shopping and eliminated tax rebates on energy-efficient appliances. Power bills will also be subject to sales tax, starting in July, but regulators are still working out how much of that increase will be passed on to consumers.
Sen. Bob Rucho, R-Mecklenburg, who authored some of the tax changes, said the system needed to be updated. The economy now revolves around services and entertainment, but state sales taxes have applied only to goods, which is about one-third of what people buy.
"That means everything else is not sharing in helping the cost of government and putting lower tax rates back in the pockets of the people," Rucho said.
December 27, 2013 at 11:19 am
Norm Kelly says:
We tried it the Demoncrat way. They kept raising the sales tax. They carved out certain things to avoid the new tax, but they still raised the tax. Did anyone wonder how people would pay the increased sales tax? Did anyone complain about the carve-outs for certain products that weren't taxed? Could anyone explain why the DemocRATs chose the products they chose to be tax free?
And what about the sales tax weekend? Every year that the Demons had this plan in place, all we heard from Raleigh was how much the weekend was costing the state. Not how much the higher sales tax was costing people throughout the year, just how much it cost the state. So, eliminating the weekend has many affects. First, businesses don't have to make system changes for a single weekend, allowing for all the items that are tax free and those that aren't tax free. People don't have to worry about standing in stupidly long lines waiting to check out because the central planners only allow this one weekend, this very short period of time, to get the discount. (NOTE: if 10 days is insufficient to vote, if 10 days to vote is too short for black people to make it to the poll, how is it that only 1 weekend a year for a sales tax break isn't discrimination against helpless/hapless black people? just remember, before you call me the racist, it's the dems & libs in general that are saying blacks can't manage to find a way to vote in only 10 days! it's the libs that are claiming blacks can't figure out how to accomplish 1 task in a 10 day period. so using lib logic (a non-existent entity), doesn't it mean that if 10 days ain't enough, 3 days is certainly too short. if it's discriminatory in one instance, why isn't it discriminatory in the other instance? if you were offended by my comment, you are a lib, so try to explain this, cuz it doesn't make sense to a non-lib.)
Next, about the tax free weekend. If the central planners are 'giving' a free weekend, isn't it that they are admitting the sales tax is too high the rest of the year? The last time they raised the sales tax, they implemented the free weekend. One idea begot the other idea. Like they were saying that if we raise the sales tax this high, the people are going to revolt, so let's 'give' them something to appease them. And, son of a gun, the appeasement plan worked. The lemmings all got in line, and did the lemming thing that the Demoncrats wanted you all to do. Ignore that you are paying too much in sales tax all year long, so you can get 1 weekend where SOME of your purchases are tax free. So long as you are willing to stand in a very long line in order to check out. And lemming yourself right over the edge of the cliff.
One idea the Demons never contemplate. Lower the tax rate (any tax rate), but make the tax base broader. When Demons implement tax increases, they usually try to carve out some special considerations for either a special product or a special group of people. They call it a targeted tax increase. Which means the central planners are picking winners & losers. The Republican plan for NC calls for the rate for EVERYONE to be lowered (a good thing for everyone), while at the same time broadening the base of products that are taxed, eliminating the special carve-outs. How do libs respond to this idea? They hate it because it takes POWER AWAY from the central planners. Why is the N&D opposed to a sales tax on their product? Because they like special carve-outs. They like being treated special by their buddies in the central planner organization.
'Power bills will also be subject to sales tax, ... regulators are still working out how much of that increase will be passed on to consumers'. How is the cost of doing business calculated by regulators under the old plan? If the income tax rate went down for utilities, won't this be reflected in the new calculation? And, it has been revealed elsewhere that income tax was one item considered by regulators in the cost of doing business to determine what rate the utility could charge. So, the new math shows that utilities will pay a lower income tax, which lowers their cost of doing business, which lowers the rate they are allowed by regulators to charge us. Then, and only then, is the sales tax added on to the bottom line of the bill. And if my cell phone not only charges a sales tax, it charges a 911 fee, plus a federal tax to compensate someone else's phone bill, why is it that power utilities have been exempt from sales tax in the past? Was this another carve-out by DemocRATS? Should this carve-out continue to exist? Isn't it possible that the new lower sales tax rate with a broader base just might increase the state's take and allow for another sales tax rate cut? Are libs willing to consider this aspect of it? If regulators do their job, they will find that a lower income tax rate for utilities will lower the rate charged to customers, then the sales tax will be added. The net effect could be almost zero for many if not most customers of the utility. When the Demons raised the tax on a gallon of their hated gasoline, did they worry about how it would impact family budgets? Nope. So why the big deal now? When King Barack wanted to eliminate most of the power sources in the country because it's not green enough, this would have caused the cost of power to be so high, so far out of reach, that many citizens would have their power turned off. It would be too expensive for them or it would be too expensive for the company to produce. What was the lib reaction to that? Not nearly what it is to taxing my (lowered) utility bill. Libs are very confused people, who, when given power, simply pass that confusion onto the rest of us. I'm happy not having YOUR confusion passed on to me. I have enough confusion of my own, I don't need to take yours on also. Witness the confusion of Obamacare. Completely a Demon plan, yet so confused that even the people in Washington who passed it (demons only!), do NOT understand it nor like it's implementation. Witness their trying to avoid being controlled by their own plan.
December 27, 2013 at 3:04 pm
hampton brady says:
The 2014 and 2015 tax reforms in NC are exactly as Ms. Leslie described, "a tax shift" from the rich to the working and middle class. Moreover, the tax shift broadens. Thanks to the Tea publicans we have a sales tax on labor and other services that hurt the working class more than the rich. Sales taxes will also be extended to nonprofit organizations that offer entertainment. The republican strategy was simple: disguise the new taxes so the working-class would not notice. And if perchance they did notice the additional tax increases, Tea publicans could blame Obamacare just like they did concerning my in-grown toe-nail.
Like Ms. Leslie said, a fair tax suggests that a person making $20K can as easily afford to pay 10 percent and live on $18K a year, as someone making a million can live on $900K after taxes. Moreover, the working-class usually spend all of their income to make ends meet, month to month- while the rich do not. The other flaw in the so-call fair tax argument is the rich use the extra income from their taxes to create jobs. Yea, right!
