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NC House, Senate Plans Differ On Sales Tax

By Associated Press Posted May 17, 2013 at 8:02 am

RALEIGH – A tax code overhaul plan unveiled by House Republicans puts them at odds with Senate counterparts on how many transactions should be subject to North Carolina’s sales tax.

The House plan released Thursday would expand the combined sales tax to cover a few more items such as car and lawn mower repairs and product warranties. The Senate would subject nearly every service to the sales tax and eliminate exemptions on groceries and prescription drugs. The House plan keeps both exemptions.

House plan author Rep. David Lewis says he’s optimistic a compromise with the Senate can be worked out. Senate leader Phil Berger says failing to broaden widely the sales tax base prevents lower tax rates that spur economic growth.

Gov. Pat McCrory says he’s “encouraged” by the House plan details.

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