Constitutional amendment proposed to lower maximum state income tax rate

RALEIGH, N.C. (WITN) - Republican state senators have filed a bill to let voters decide whether to lower the maximum income tax rate.

Senate Bill 1080, or “Lower Taxes for All NC,” was filed by senators Lisa Barnes, Michael Lee, and Benton Sawrey. The proposal would reduce the maximum state income tax rate from 7% to 3.5%.

The amendment would show on the November 2026 general election ballot for voters to decide, if approved.

North Carolina voters previously approved a constitutional amendment in 2018 that lowered the maximum rate from 10% to 7%.

The state’s current flat income tax rate is 3.99% and is set to drop to 3.49% in 2027, according to a news release.

The proposal is part of the state budget framework agreement announced by Senate leader Phil Berger and House Speaker Destin Hall.

“There is no question that North Carolina has one of the strongest, fastest-growing economies in the country, and that’s a direct result of Republican-led fiscal policies,” Sen. Lee said. “A crucial pillar of that success has been consistently lowering taxes and putting money back into the pockets of hardworking North Carolinians. When it comes to setting the maximum rate, the people of our state deserve to have a say.”