THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Friday, June 14, 1996 TAG: 9606140613
SECTION: LOCAL PAGE: B2 EDITION: NORTH CAROLINA
SOURCE: BY EMERY P. DALESIO, STAFF WRITER
DATELINE: RALEIGH LENGTH: 49 lines
A House committee accelerated the tax-cutting bandwagon Thursday by packaging together eight different breaks benefiting laid-off workers, corporate profits and heirs facing inheritance taxes.
The House Finance Committee packaged the tax breaks into one bill to help its passage through the House and the Senate, committee co-chairman Rep. Lyons Gray said.
Republican sponsors said their proposed tax cuts would spur economic growth and create good jobs.
``This bill will increase business investment and job growth in North Carolina. A healthy economy benefits us all,'' Gray, R-Forsyth, said.
One Democrat said the bill was designed to help corporations.
``It's a very anti-people and pro-business bill. The tax cuts don't go to Joe and Mary Average. They go to Mr. and Mrs. Industrialist,'' state Rep. Bob Hensley, D-Wake, said.
The House already has approved phasing out the state's share of the sales tax on food, now at 4 percent.
The Senate this week decided to trim the food tax by only 1 percent and add slight reductions in the corporate income tax rate and a tax paid by soft-drink bottlers. The tax breaks would total $129 million when they take full effect in the 1997 budget year and $138.2 million in 2000.
House Republicans raised the ante Thursday by further cutting the rate at which corporate profits are taxed and phasing out the soft drink tax.
The House package also:
expanded an investment tax credit for business property.
allowed wages paid as severance when a manufacturing or processing plant closes to be exempt from state income tax.
reduced the inheritance tax.
cut the sales tax on electricity and natural gas used in farming and manufacturing.
allowed companies a 5 percent credit for research and development spending that is eligible for federal tax credits.
offered a sales tax break benefiting cellular telephone service providers and other businesses which give away or discount an item in return for a consumer agreeing to a service contract.
The House package of tax breaks would total $144.5 million in 1997 and $377.6 million in 2000.
The food tax repeal approved by the House would cover the total $380 million loss in four years by barring state jobs from being filled as workers leave the state payroll. by CNB