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New Year Means Lower Corporate Tax Rate

| Tax Policy & Competitiveness

With the start of the New Year also comes a lower corporate tax rate for your business. Starting Jan. 1 your corporate tax rate dropped to 5 percent, down from 6 percent in 2014. The NC Chamber worked for you to create a more competitive tax climate and the results from the 2013 reforms continue to pay off for North Carolina employers. We championed House Bill 998 which reduces the personal income tax level for all North Carolina taxpayers and cuts corporate taxes so North Carolina companies can create jobs and make the state more attractive to new businesses. This marks real savings for North Carolina’s job creators, both small and large, and positions our state to be a leading job creator in the South.

Your corporate rate will continue to fall in the coming years – 4% in 2016 and 3% in 2017 – if North Carolina meets revenue targets ($20.2 billion in general tax collections by June 30). Continued economic growth is critical to hitting these targets in 2016 and keeping your corporate rate low as certain tax credits expire. We know that other states are not standing still which means North Carolina needs to continue improving its tax climate to continue the state’s positive momentum in job creation and economic growth. With the 2015 Legislative Session only weeks away, we will keep you updated on our action to make your tax climate even more competitive.

Gary J. Salamido
Vice President, Government Affairs
North Carolina Chamber