Easley appoints group to simplify tax code

Gov. Mike Easley on Friday appointed a panel to tackle one of the toughest tasks in government: tax reform.

Easley’s picks for the 15-member Commission to Modernize State Finances include elected officials, accountants and other business leaders.

The governor is asking the group to simplify the tax code, insulate state revenues from economic downturns, update the tax structure for the modern economy and keep it fair and competitive.

“The basic structure of North Carolina’s revenue and finance laws was created over seven decades ago,” the governor said in a written statement. “This commission’s job is to modernize these laws, ensuring a stable, fair and reliable revenue stream while maintaining the state’s economic competitiveness.”

Easley has been immersed in a state budget crisis almost since the day he took office a year ago. From the beginning, he has pointed out that one of the causes of the state’s troubled finances is its antiquated tax structure.

North Carolina’s heavy reliance on the sales tax, for example, makes it vulnerable to economic downturns. As consumer spending plummets, so do state sales tax revenues.

Similarly, North Carolina does not tax services, despite the increasing role they play in the state’s economy.

Easley spent a good deal of time looking for a broad cross-section of expertise for his new commission, spokeswoman Cari Boyce said Friday.

Those choices earned praise from Jonathan Hill of the conservative tax-reform organization Citizens for a Sound Economy.

Hill praised Easley for taking on a “huge” undertaking that is long overdue.

“The ones I know are all outstanding people, and I’m sure the other choices, in their own fields, are just as outstanding,” Hill said.

Easley’s choices are:

– State Rep. Gordon Allen of Roxboro.

– Lucy Allen, former mayor of Louisburg.

– Mary Ann Black, chairwoman of the Durham County Board of Commissioners.

– State Sen. Daniel Clodfelter of Charlotte.

– Frank Emory of Charlotte, a corporate lawyer.

– Michael A. Hannah of Raleigh, Deloitte & Touche.

– Kay Hobart of Raleigh, assistant attorney general for the state Department of Revenue.

– State Sen. David Hoyle of Gastonia.

– Horace Johnson of Raleigh, an accountant at Ernst & Young.

– John Medlin of Winston-Salem, a former CEO of Wachovia.

– Charlie Mercer of Raleigh, an attorney for Moore & Van Allen.

– Tom Ross of Winston-Salem, executive director of the Z. Smith Reynolds Foundation.

– Ben Russo of Charlotte, an economics professor at the University of North Carolina at Charlotte.

– State Rep. Wilma Sherrill of Asheville.

– Jim Talton of Raleigh, a retired KPMG accountant.

Easley asked the commission to present preliminary findings before the General Assembly returns to Raleigh in May. Final recommendations are expected in time for the next long session, which begins in January 2003.