Shortfall could affect state's credit rating
Published April 17, 2014
Editorial by Burlington Times-News, April 16, 2014.
Credit-rating agencies offered taxpayers a small piece of good news this month, issuing North Carolina triple-A credit ratings. With the state about to offer $314 million in bonds, those top-shelf ratings will result in the lowest possible interest rates, which will mean less burden from the resulting debt.
But don’t celebrate yet. Another piece of news recommends caution. State revenues from personal income tax withholdings were $221 million below expectations this year through March. Windfalls in corporate income taxes and sales taxes have nearly offset that shortfall. But those revenue sources fluctuate too much with economic tides.
While there’s a reasonable expectation that the state will see a flurry of tax collections this month - it is April — the situation points to underlying problems with the tax reforms lawmakers approved last year. The new rates may not produce enough revenue.
The credit agencies said we earned high ratings through diminishing debt, improving economics and conservative fiscal operations. That doesn’t necessarily mean “fiscal operations by conservatives.” Lawmakers have been aggressive on cutting taxes, but not so careful on ensuring that we can pay our bills. That’s the difference between sound fiscal policy and hollow populism.
To ensure our credit rating stays solid, we may need to further tweak our tax structure.
April 17, 2014 at 11:26 am
Norm Kellly says:
'Lawmakers have been aggressive on cutting taxes, but not so careful on ensuring that we can pay our bills.' As opposed to when demons ran Raleigh? You mean when demons told us every year that they had cut the budget to the bone, but had no choice but to raise taxes & fees. And the spending side of the budget went UP every year. You mean like when the demons who controlled Raleigh would tell us EVERY year that sales tax revenues were going to be significantly below expectations and that there would be a budget shortfall? You mean like when Gov Mike was occupying the mansion and he stole money from sales tax revenues destined for counties? You mean like when Gov Mike was occupying the mansion and he stole money from the E911 fund so he could balance the budget? You mean like when the demons controlled Raleigh and spent one-time money in the budget on line items that were on-going expenses?
You mean that type of carefully insuring that the state budget was sound?
Did you mean aggressively cutting taxes the way the demons did when they controlled Raleigh? Like when they implemented a temporary sales tax increase? Oh, wait, my bad. That was a temporary sales tax only temporarily, until they converted it to a permanent sales tax increase. And if my old memory serves me at all, don't I recall that Raleigh demons did this more than 1 time? Like when the price of a gallon of gas was going up and the demons claimed that it was better for citizens to pay an even higher gas tax at the pump because we could afford the more costly gas AS WELL AS the higher gas tax? But the state couldn't afford NOT to raise the gas tax? That type of caring about the budget AND the citizens?
It has been proven time and again that a fair tax system, a predictable tax system, where the rates are set at an appropriate level, combined with prudence in government spending, is good for both the economy and the residents/citizens of that state/region. It has also been shown repeatedly that demons have NO CONCEPT of economics. Demon/socialist plans simply destroy an economy, and make citizens dependent on government instead of themselves. If state spending is appropriate, and tax rates, all tax rates, are appropriate, the increase in economic activity WILL overcome any projected shortfall in state revenue. Lefties ALWAYS, CONSISTENTLY ignore the affect of tax policies on people's actual activity. Lower rates generally are reflected in MORE economic activity. This usually translates into level revenues for the state. It's also possible, and often happens, that when tax policy and government spending/interference in the markets, are at appropriate levels, revenues can actually INCREASE to the government. How do libs/lefties/media-types argue this? They lie about it, of course. To lefties, money is a static pool. There is only so much of it and when one gets a little more it's because someone else has gotten less. The theory of a rising tide lifting all boats is unknown to libs, or at least not believed by libs. Cuz facts are genetically foreign to libs.
I truly hope that we always have at least a few libs around saying the goofy things they say, proposing the idiotic proposals they put forth. This will remind us all why we fight the fight, why we continue to be prudent. It's when the citizens, we the people, get lazy that libs take control and do their thing to destroy the private sector, personal responsibility, morale, the family unit, babies, the general economy.
