North Carolina

The facts on North Carolina’s Tax Climate

North Carolina's Individual Income Tax System
North Carolina's personal income tax system consists of a flat rate of 5.8%. That rate ranks 25th highest among states levying an individual income tax. North Carolina's state and local income tax collections per person were $1028 in 2011 which ranked 16th highest nationally.
50-State Table of Individual Income Tax Rates
50-State Table of State Individual Income Tax Collections
50-State Table of State and Local Individual Income Tax Collections Per Capita

North Carolina's Corporate Income Tax System
North Carolina's corporate income tax system consists of a flat rate of 6%. That rate ranks 16th lowest among states levying a corporate income tax. North Carolina's state and local corporate income tax collections per person were $114 in 2011 which ranked 25th highest nationally.
50-State Table of Corporate Income Tax Rates
50-State Table of State and Local Corporate Income Tax Collections Per Capita
50-State Table of State Corporate Income Tax Collections Per Capita

North Carolina Sales and Excise Taxes
North Carolina levies a 4.75% general sales or use tax on consumers, which is below the national median of 5.95%. The average local sales tax rate is an additional 2.15%. North Carolina's state and local governments collect $862 per person in general sales taxes and $416 per person in excise taxes, for a combined figure of $1278, which ranks 25th highest nationally. North Carolina's gasoline tax stands at 37.8¢ (9th highest nationally), while its cigarette tax stands at $0.45 (7th lowest nationally.)
50-State Table of State and Local General and Selective Sales Tax Collections Per Capita

North Carolina Property Tax Collections Relatively Low
North Carolina's state and local governments collected approximately $900 per person in property taxes, which ranks 12th lowest nationally.
State and local property tax collections per capita by state

Tax Freedom Day Arrives on April 14th in North Carolina

Tax Freedom Day is the day when Americans finally have earned enough money to pay off their total tax bill for the year. In 2014, North Carolina taxpayers worked until April 14th (23rd earliest nationally) to pay their total tax bill. The Tax Freedom Days of neighboring states are: Tennessee, April 5th (ranked 4th earliest nationally); Georgia, April 12th (ranked 19th earliest nationally); South Carolina, April 9th (ranked 8th earliest nationally); and Virginia, April 24th (ranked 11th latest nationally).

North Carolina's State and Local Tax Burden In Line with National Average

North Carolina's 2011 tax burden of 9.85% ranks 17th highest out of 50 states, and is above the national average of 9.8%. North Carolina's taxpayers pay $3564 per capita in state and local taxes.
North Carolina's State-Local Tax Burden, 1977-Present
Other States' State/Local Tax Burdens
Map of U.S. Showing all State's Burdens and Ranks
Historical Chart Comparing All States' State/Local Tax Burdens from 1977 to 2009

North Carolina's 2014 Business Tax Climate Index Ranks 44

North Carolina ranks 44th in the Tax Foundation's State Business Tax Climate Index. The Index compares the states in five areas of taxation that impact business: corporate taxes, individual income taxes, sales taxes, unemployment insurance taxes, and taxes on property, including residential and commercial property. The ranks of neighboring states are as follows: Tennessee, 15th, Georgia, 32nd, South Carolina, 37th, and Virginia, 26th.
50-State Comparison of Business Tax Climates (data only) (2013)
2014 State Business Tax Climate Index (full study)

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