Is Closing a Tax Loophole a Tax Increase?

Recently, Republicans in the state House have considered supporting a Senate budget proposal that would close certain tax loopholes to fund the state budget.

Jonathan Hill, Director of North Carolina Citizens for a Sound Economy (NC CSE), issued the following statement on the Senate’s proposal:

“We are listening carefully to the tax debate and watching the shifts in tax burdens from one source to another. We want to ensure all tax changes or loophole closings are revenue neutral. We agree with the premise of making the revenue laws fairer and simpler, however, any changes should be revenue neutral. Eliminating tax loopholes allows rates to be reduced so changes can be revenue neutral.

“If the state receives additional funds when it closes a loophole, that is a tax increase. A tax increase that will be passed on to the taxpayers in one form or another.

“Closing tax loopholes to raise additional funds is merely a cleverly disguised attempt to raise taxes on the hard working citizens of North Carolina.”