Tax policy think tank Tax Foundation released its 2015 State Business Tax Climate Index, and North Carolina legislators have a lot to smile about.
According the foundation's index, North Carolina jumped 28 spots from ranking 44th this past year to 16th this year. North Carolina tax policies implemented this past year reduced individual income taxes from 7.75 percent to 5.8 percent and reduced the corporate tax rate from 6.9 percent to 6 percent, and could be reduced further depending on the state's balance sheet in coming years. The standard tax deduction was also increased for individuals.
The 28-spot jump is the largest jump in the history of the Tax Foundation index's history, according to Forbes, and no other state moved more than five spots this year.
The Tax Foundation uses more than 100 variables to determine the index, including factors like individual income tax, corporate income tax, sales tax, unemployment insurance tax and property tax, to show how well states structure their tax systems. The group doesn't say that these states have the best economies, but simply rank them based on items like tax rates and complexity.
Liberal groups have criticized the state's recent tax cuts as disproportionately benefitting the rich. A report by the John Locke Foundation, a conservative-leaning policy group in Raleigh, shows that households earning between $50,000 and $75,000 would save $79 per year, while those earning $200,000 and more would see savings of $2,848, on average.