by Sarah Curry
John Locke Foundation
May 22, 2013
A larger annual appropriation to the savings and reserves account would allow state budgets to use those funds during a budget shortfall rather than raising excise taxes. Excise taxes have not been shown to alter behavior significantly, so the increasing of excise taxes on products should be eliminated. If excise taxes are to be used as a user fee, as is the case with gasoline, then collections should be used accordingly. Much of North Carolina’s current gasoline tax goes to the General Fund or is spent on items other than highway construction and maintenance. More transparency needs to be incorporated so that taxpayers know exactly how much they are paying. Receipts for items on which an excise tax is levied should clearly list the base price of the item as well as the tax; this will allow the taxpayer to see how much is paid in each transaction.

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