On the eve of Tax Day, two N.C. Senate leaders said their tax cuts have saved taxpayers nearly $2.4 billion over the last four years.
While acknowledging that some people are paying higher taxes, Senate President Pro Tem Phil Berger and Sen. Bob Rucho said most are paying less because of GOP policies.
“I don’t think there’s any question that folks overall are paying less,” Berger told reporters.
But Alexandra Sirota, director of the liberal N.C. Budget & Tax Center, argues that the majority of taxpayers – those with incomes under $84,000 – are paying more.
With returns still coming in, a Revenue Department spokesman said it is too early to say exactly what the effect of the changes will be on taxpayers.
Berger and Rucho, a Matthews Republican who co-chairs the Senate Finance Committee, said Republicans saved taxpayers $1 billion a year by letting a temporary sales tax increase authored by Democrats expire in 2011.
More savings, they say, come from a 2013 tax overhaul that cut the top personal income tax rate from 7.75 percent to 5.8 percent in 2014. It drops to 5.75 percent this year. Lawmakers also exempted the first $15,000 of income from being taxed.
But they eliminated an array of benefits including a low-income tax credit and deductions for retirement benefits and un-reimbursed medical and dental costs, a change that has hit many senior citizens.
Berger acknowledged that lawmakers have heard their concerns. He invited taxpayers to send in their redacted returns. “We’ll of course take that into consideration,” he said.
But Berger dismissed criticism from groups such as Sirota’s that more taxpayers are facing higher bills.
“I’d like to see their data,” he said. “Remember there are folks out there who’d like people to believe that they’re paying more taxes. But that’s just not the case.”
Sirota said the Budget & Tax Center analysts use a model based on a sample of actual tax returns. She also said people are paying more in sales taxes after lawmakers expanded the base of services to be taxed and argues that more of the tax cuts have benefited the wealthy.
Rucho said the Senate lawmakers plan to cut income tax rates still further while eliminating more of what he called loopholes and “special tax preferences” and raising the standard deduction to $20,000.
“This is the first step in the direction we want to go in this,” he said.