# North Carolina Voters Weigh Constitutional Cap on State Income Tax Rates A proposed amendment seeks to limit income tax ceilings amid national affordability debates. - **Source:** [Fortune | FORTUNE](https://brifing.si/source/769282ef-327a-4454-909a-3c7936216004) - **Published:** 2026-11-03 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/e25aa271-205d-484e-8b04-b32b9c1a0965 ## Constitutional Amendment Proposal North Carolina voters are deciding on a constitutional amendment to lower the maximum allowable income tax rate from 7% to 3.5%. This measure aims to restrict future legislative ability to raise income taxes. If approved, any increase above this 3.5% threshold would require a three-fifths majority vote in both legislative chambers. ## Current Tax Trajectory The amendment does not immediately lower current tax rates, which stand at 3.99%. Existing legislation already mandates a gradual reduction to 2.99% by 2033. Republican sponsors argue this cap locks in progress from a decade of tax reforms, while critics claim it offers no immediate financial relief to the state's residents. ## Political Opposition Stance Governor Josh Stein opposes the measure, arguing it fails to put more money into citizens' pockets. He contends the amendment primarily benefits the wealthy while potentially forcing future reliance on sales tax increases. Because the cap is constitutional, the governor cannot veto the proposal, leaving the final decision entirely to state voters. ## Revenue and Public Services Individual income taxes generated approximately $17 billion for North Carolina in the 2024-25 fiscal year. This revenue accounts for nearly half of the state's $34.6 billion General Fund. Opponents warn that restricting income tax flexibility could force future budget cuts to essential public services like education and healthcare during economic downturns. ## Legislative History Context Since gaining control of the General Assembly in 2011, Republicans have consistently pursued tax-cutting agendas. They transitioned the state from graduated brackets to a flat tax system in 2013 and reduced corporate taxes. In 2018, voters approved a previous amendment that lowered the maximum allowable income tax rate from 10% to 7%. ## Broader National Tax Debate North Carolina is part of a wider national trend where voters are weighing various tax initiatives. States like Colorado, Iowa, and California are also considering measures ranging from wealth taxes to legislative supermajority requirements for tax hikes. These proposals reflect voter anxiety regarding inflation and the rising cost of living nationwide. ## Economic Affordability Concerns Rising costs remain a primary issue for voters, with 48% of registered voters identifying it as their top concern. While Republicans focus on tax caps to address affordability, Democrats emphasize the potential long-term consequences of these policies. The debate highlights a fundamental disagreement over how states should manage revenue and fiscal stability. ## Future Policy Implications The outcome of this referendum will define the state's fiscal framework for years. By embedding tax limits in the constitution, the legislature effectively binds future administrations to current economic philosophies. Voters must now decide if this permanent restriction provides necessary protection or creates an inflexible system for managing future state financial needs. ## Sources covering this story - https://fortune.com/2026/11/03/republicans-democrats-midterm-election-north-carolina-income-tax-cap-voting-laws/ — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._