The Cato Institute today released its 2010 Fiscal Policy Report Card for state governors. How did North Carolina’s do?
Governor Perdue had only been in office a short time when she signed into law a giant package of tax increases to raise $1 billion a year. Middle-income earners were hit with a 2 percent surtax on their income taxes, while higher earners and corporations were hit with a 3 percent surtax. In addition, the state sales tax rate rose by one percentage point. These are supposed to be temporary tax increases, but temporary increases often become permanent. Perdue also broadened the sales tax base, increased the cigarette tax by $1 per pack, and hiked taxes on beer, wine, and liquor. Seemingly oblivious to the damage caused by these large hikes, Perdue has recently toured the state to tout her plan to create jobs by providing narrow tax “incentives.”
In fact, Governor Perdue only edged out a failing grade by one point. Reading through their general list of policies that hurt governors’ grades (as well as their states) on pages 6-7, one might think one was reading the Civitas Review blog. Not only has Perdue enacted tax hikes and thrown around incentives willy-nilly as her excerpt shows, but film credits have been an ongoing controversy as well, a category sadly rampant enough among other states to warrant its own bullet point in the report.
The governor’s race isn’t for a few more years, but we can make sure our legislators have fiscal principles this November. North Carolina can do better than D-rate politicians.