Budget & Taxes

SB 1080 proposes a constitutional amendment to cap North Carolina's state income tax rate at a maximum of 3.5%. If approved by voters in the November 2026 election, this change would prevent the legislature from raising the income tax rate higher than that threshold in the future. The bill applies to taxable years beginning on or after January 1, 2027, and requires a majority vote in favor to become law.

This bill, known as the Mike Clampitt 1st Responder Tax Fairness Act, aims to expand tax exemptions for volunteer fire departments and rescue squads in North Carolina. Specifically, it allows these independent groups, which have two or fewer paid employees and are already exempt from state income tax, to avoid paying a highway use tax on specific emergency vehicles like fire trucks, forest firefighting units, and other emergency service vehicles. The change applies to vehicles when a certificate of title is issued on or after July 1, 2026, ensuring these organizations can acquire necessary equipment without incurring this particular tax. By broadening the existing exemption, the legislation directly benefits volunteer responders who operate outside of local government units.