Governor McCrory Signs Tax Reform Into Law

Change is on the way for North Carolinian's following Tuesday's signing of the tax reform bill by Governor Pat McCrory.

The Republican led legislature says this new law will bring tax relief to state residents and encourage businesses to relocate to our state, while easing the burdens on those already here.

McCrory says, "There are a lot of people unemployed right now. A lot of people looking for work and a lot of companies that are looking at other states to go to to create new jobs and they're beating out North Carolina. So the pain has arrived and usually when the pain arrives people move toward action and we've moved toward action because people are hurting."

Those specific actions include lowering the income tax for all individuals to 5.8 percent, as well as reducing the corporate tax to 6 percent by 2014.

The bill signing comes as lawmakers consider a $20.6 billion state budget which would move to a performance based system for teachers by eliminating tenure. It also wouldn't provide a pay raise for them.

Senate Leader Phil Berger says, "We've gone through a number of tough years and remember last year we were able to give a raise. This year the numbers I've seen is about 1 and a half billion dollars in unexpected Medicaid expenditures. That's created some problems for us."

Governor McCrory pointed to the tax reform bill as an alternative. "But let me tell you what right now this tax reform will give a teacher making approximately $40-45-thousand a year a 1 percent increase in their take home pay due to this tax reform. That's good news for teachers or people working in a manufacturing plant."

Opponents like the North Carolina Association of Educators say the budget move would place a sign on each school door that says quality educators need not apply.