North Carolina: Governor Signs Budget Enacting Tax Increases

Posted by accountingweb on Aug 11 2009 2455 printer friendly

The Governor of North Carolina has signed the budget bill (SB 202) into law.

The bill (SB 202) contains several tax law changes:

A surtax (or additional income tax) equal to 2% or 3% of the tax payable by the taxpayer (would apply to corporations and individuals for calendar tax years 2009 and 2010).
Sales tax rate would increase from 4.5% to 5.5% from 9/1/09 to 10/1/09.
Sales tax rate would increase to 5.75% effective 10/1/09 and expire on 7/1/2011.
The "Amazon Law" or affiliate nexus provision (similar to NY and RI) requiring remote merchants or sellers to collect sales tax on sales to in-state purchasers based on the affiliate's nexus connection to North Carolina.
Expands the sales tax base of digital property.
Increases the alcohol excise and tobacco products tax rates.
Changes in North Carolina's conformity with the Internal Revenue Code (impacts deductions for real property taxes, motor vehicle sales taxes, deferral of cancellation of indebtedness income (COD), corporate deductions of original issue discount on high-yield discount obligations, and bonus depreciation).

Click on the following link to access SB 202 (pages 218 thru 238 discusses the tax changes):http://www.ncga.state.nc.us/sessions/2009/budget/2009/S202-CCSMAxf-3.pdf

If you have any questions, please contact me at leveragesalt@earthlink.net.

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