The tax plan to make up a billion dollars is apparently back at square one after Governor Perdue objected.
The Governor said she wouldn't support a measure calling for an extra tax on individuals and businesses that didn't pay enough income tax during the year.
Perdue publicly chastised lawmakers, saying she was "stunned" by the idea of an income tax surcharge.
The state has been operating under a continuing resolution since the start of the fiscal year on July 1.
The stopgap measure expires at the end of the month.
Gov. Beverly Perdue has told legislative leaders she won't support a North Carolina state budget that raises the income tax bill for those she calls "working families."
Perdue said she expressed her concern Thursday to Senate leader Marc Basnight and House Speaker Joe Hackney.
The $982 million tax deal that House and Senate Democrats agreed to this week contains a 2 percent surcharge on anyone with an income tax bill. Legislators earlier had considered placing the surcharge only on the highest wage earners.
The tax plan is expected to be inserted into the final two-year budget that lawmakers could vote on as early as next week.
Perdue says she also "reemphasized the need to protect public schools" in her talks with Hackney and Basnight.
(Copyright 2009 by The Associated Press. All Rights Reserved.)