While our friends on the left continue to complain about how conservative economic policies are holding North Carolina back, the state continues to enjoy lower unemployment and unprecedented budget surpluses.
It was announced yesterday that for the first quarter (July – September) of the current (2016-17) Fiscal Year, North Carolina collected $191 million more in tax revenue than expected. That’s 2.6 percent above target. This surplus helps pad the General Fund with a total $46.3 million in revenue heading into October.
This latest surplus is driven by more people working (North Carolina’s businesses have created more than 440,000 jobs in the last five years), fatter paychecks, and more than $15 billion in tax relief since Republicans took control of the state legislature in 2011.
For what it’s worth, this isn’t the first time that the left’s policy experts have managed to get it all wrong when it comes to tax cuts and budget surpluses. A few of the many examples:
- NC PolicyWatch: Monday Numbers (by Chris Fitzsimon, May 12, 2014): “600 million — amount in dollars of the potential state revenue shortfall in 2014-2015 because of the higher than expected cost of the personal income tax cuts enacted in 2013”
- BTC REPORTS: 2015 Budget Undermines North Carolina’s Competitiveness (by Tazra Mitchell, Cedric Johnson & Alexandra Forter Sirota, September 2014): “…the new tax cuts already are costing the state much more than expected and will continue to reduce the revenue that is available…”
- Massive tax cuts and NC’s ballooning revenue shortfall (by Chris Fitzsimon, NC Policy Watch podcast 10/27/2014)
- Expert Opinion: N.C. Budget & Tax Center’s Tazra Mitchell on our state budget: “Legislative leaders and the governor failed to acknowledge the tax plan’s growing cost in the 2015 fiscal year budget, likely because they knew that the huge revenue losses put the state on a financially irresponsible and unsustainable path. By the end of the fiscal year, the revenue shortfall could reach as high as $600 million—for a total cost of more than $1.1 billion”
- Revenue continues to underperform projections, shortfall likely to grow larger (by Tazra Mitchell, October 2014)
- Mid-year revenue shortfall grows, official revenue outlook filled with caution and uncertainty (by Tazra Mitchell, January 21, 2015): “…The fact that lawmakers allowed the next round of costly income tax cuts to go into effect earlier this month—rather than pausing the plan and reassessing the damage—will do little to improve the revenue picture going forward.”
- Time for legislators to stop ignoring North Carolina’s revenue shortfall (by Chris Fitzsimon, NC Policy Watch podcast 1/26/2015)
- Revenue Shortfall Caused by Tax Plan Hinders Investments in a Strong Economy (North Carolina Justice Center)
The budget surplus announced yesterday follows an earlier budget surplus, announced over the summer, of $425 million received over what was projected for the last fiscal year (ending June 30, 2016) when the State Budget Office revised revenue figures upward above May projections by $95 million. There was also a surplus announced back in March.
For more information on this and other economic successes under Republican leadership, be sure to download this cool graphic.