North Carolina voters approve tax limits on income and property as cost of living tops voters’ worries

As housing prices increase nationwide and Americans increasingly voice their frustration with affordability, voters in North Carolina have approved a constitutional amendment that lowers the state’s income tax cap from 7% to 3.5%.

The Associated Press called the race at 9:21 p.m. Tuesday, with 61% of votes in favor and 89% of votes counted, according to WBTV. The amendment bars the General Assembly from raising the income tax rate above 3.5% unless voters approve another constitutional change. North Carolina currently has a 3.99% flat income tax rate for all earners, and that rate is scheduled to fall in the coming years. The new ceiling replaces the 7% cap voters approved in 2018. The Republican-led General Assembly put the amendment on the ballot over objections from Democratic lawmakers.

Republican state Sen. Michael V. Lee, who sponsored the legislation, argued earlier this year that the cap protects taxpayers from future increases and locks in more than a decade of tax cuts. Democratic Gov. Josh Stein opposed the amendment, calling it “a con, a cynical shell game and a millionaire protection cap.” He argued it would shield the wealthy from future income tax increases while regular people bear the cost.

A separate constitutional amendment on property taxes, which was still being counted late Tuesday, also had the support of the North Carolina General Assembly’s Republican majority. It would not immediately reduce property taxes, but would require the legislature to pass a law that would limit the amount of property tax a local government can raise from one year to the next, with details like the specific limit and exceptions to be decided by the state legislature at a later date.

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