NC Democrats pitch sales tax increase to create jobs, close loopholes
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CHARLOTTE -- The North Carolina legislature may be adjourned, but that doesn't mean the debate over jobs and the state budget is in recess.
Democratic Rep. Bill Faison from Orange County was in Charlotte Saturday where he attended the Mecklenburg County Democratic Party Executive Committee meeting. Faison is trying to rally support for his "Jobs Plan," which he unveiled in September.
"What this Republican budget did is to take over 36,000 people who were employed in this state and put them out of work," he said. "That's a terrible thing."
Faison's plan would impose a .007 cent sales tax increase (seven tenths of one penny). Faison said that would generate enough to cover the costs of rehiring 6,455 state employee positions that were cut under the current budget. He pegged the cost at roughly $387,000.
The increased tax would also generate money to cover Medicaid and SCHIP medical insurance programs. Mecklenburg Democratic Rep. Kelly Alexander said it's not a tax increase.
"That's not raising taxes, that's just keeping the ship from sinking," he said.
Alexander also likes that the plan would close 40 percent of all tax loopholes currently on the books. That revenue would be used to give a $35,000 tax credit to small businesses.
"At that level you enable those businesses to either take that money and hire somebody or to invest in improving their technology or doing something that in turn has a ripple effect," said Alexander.
However, Republican Rep. Bill Brawley disagreed.
"Businesses hire with profits, with expanding sales revenue," he said.
Brawley said people generate wealth in the private sector, not government. He called the plan, "A purely a political document."
"If taxes and regulations could create jobs, the Democrats, who had control of both of houses and the governorship, would've solved the unemployment problem before the Republican majority ever took office," he said.
The GOP took control of the N.C. House and Senate last year for the first time in more than a century, and promised to let the temporary one-cent sales tax expire.