NC House Speaker Says Budget Deal Not Reached Despite Progress on Tax Cuts
House Speaker says lawmakers are making progress but remain split on tax cuts that could trigger budget deficits.
RALEIGH, NORTH CAROLINA — North Carolina House Speaker Destin Hall said Thursday that lawmakers have made substantial progress on the state budget but have not yet reached an agreement with the Senate, leaving the state without an enacted budget for the current fiscal year.
Hall told reporters that negotiations continue over the main sticking point: whether to implement scheduled personal and corporate income tax cuts that could create a budget deficit as soon as next year.
“No agreement yet, but I’ll say I think we’ve made substantial progress,” Hall said. “There’s a path to get a deal done, and so I hope that happens soon.”
Tax Cut Dispute Remains Central Issue
The budget impasse centers on a state law passed years ago that promised tax cuts this year and next if state revenue reaches certain targets. State economists and Democratic Governor Josh Stein have warned that allowing the cuts to take effect as scheduled will create a state budget deficit as soon as next year.
House Republicans, like Stein, want to put the next round of tax cuts on hold. The Senate wants them to take effect as previously enacted.
Republican lawmakers reached an impasse over the budget last year due to disagreements over teacher raises and tax cuts, leaving North Carolina as the only state without an enacted budget in the current fiscal year.
Senate Threatens Independent Action
Hall’s comments come just two days after his Senate counterpart Phil Berger said the upper chamber is prepared to move ahead with its own budget proposal if needed.
“If we don’t go ahead and get started on that process, and we wait until we get an agreement so that we can get started, there’s no way you’re going to meet a deadline of the end of June,” Berger told reporters on Tuesday.
Hall acknowledged it’s the Senate’s prerogative to send over a bill, but said “it won’t be the first time that one chamber sends a bill to the other to not be taken up.”
Conference Report Still Possible
Despite the tensions between chambers, Hall maintains that a joint agreement remains achievable through the traditional conference report process.
“At this stage, there’s still a chance that we’re going to get it done in a conference report format,” Hall said.
The budget negotiations have significant implications for North Carolina’s fiscal future, with economists warning that proceeding with the automatic tax cuts could jeopardize the state’s financial stability in the coming years.
