I started my first business at age 22 and have worked for myself since then. Thirty-five years later, one of the biggest expenses for my company is still insurance.
As a staunch advocate for North Carolina individuals, entrepreneurs, and small businesses, I believe it is crucial to immediately address one of the financial burdens weighing down North Carolinians: the state’s high insurance-premium taxes. In 2022, these taxes amounted to an astonishing $1 billion. All together, North Carolina has collected a staggering $8.7 billion in premium taxes since 2008, and those taxes are increasing substantially every year.
North Carolina has one of the highest insurance premium tax rates in the country. It’s time for us to lower this rate and make our state the ideal market where insurance companies can thrive and create high-paying jobs.
More importantly, lowering insurance premium taxes is not only a matter of relief for North Carolina folks and small businesses but also an opportunity to enhance our state’s long-term economic vitality. By reducing these taxes, we can stimulate growth, attract insurance companies to set up shop in North Carolina, and create high-paying jobs for our people.
Yes, I’m a Democrat advocating for lower taxes. After you dust yourself off from falling off your chair in disbelief, please read on for some reasons why I’m taking this position. And, while you may think all Democrats are for taxing anything and everything, most Democrats I know just want fairness and a level playing field for everyone, especially small business and entrepreneur Democrats (yes, we do exist). I believe that fairness in taxation is the key to creating a prosperous North Carolina for working folks and small businesses.
Here are some key reasons why I believe lowering insurance premium taxes is a win-win solution for everyone in North Carolina:
1. Relief for North Carolina families: The burden of high insurance-premium taxes falls disproportionately on working-class families who are already struggling to make ends meet. Lowering these taxes would put more money in the pockets of hardworking North Carolinians, enabling them to better feed their kids, pay their bills and spend in their communities.
2. Support for small businesses and entrepreneurs: Small businesses and new business start-ups are the backbone of our economy in North Carolina, especially in rural areas. These small business owners and employees need affordable insurance to protect their operations and staff. Lower insurance-premium taxes would reduce operating costs for these enterprises, allowing the owners to pay their staff more and invest more into their business.
3. Attracting insurance companies: By reducing taxes, North Carolina can become a hot destination for insurance companies looking for lower taxes. A lower tax burden can lead to more companies choosing to establish headquarters or regional offices in North Carolina, creating high paying, high skill jobs and increasing competition, which ultimately benefits consumers with lower premiums.
4. Economic growth: A thriving insurance industry is a source of economic growth. With lower taxes, we can stimulate this industry, contributing to the overall prosperity of our state for everyone and generating incremental revenue through other channels like property taxes and income taxes.
5. Competitiveness: Reducing insurance-premium taxes will make North Carolina a more competitive insurance market. This, in turn, can lead to more affordable insurance options for our residents.
Now, some folks will say that we need these funds to cover other programs in North Carolina — except that ignores the fact we have over $3 billion in excess funds sitting in the state coffers. It also ignores the fact that lower-income folks in North Carolina are paying a larger percentage of their take home pay for premium taxes. The point is to lower the tax burden for working people, entrepreneurs, and small businesses. If we need to back fill program funding, spend some of the cash sitting in the state bank accounts.
I call upon Leader Berger, Speaker Moore, and leaders in the General Assembly, regardless of their political affiliation, to support lowering insurance-premium taxes in 2024. Lowering insurance-premium taxes is a step toward a more equitable future for North Carolina, making it the premier market for insurance companies, creating high-paying jobs for our people, and recognizing that working folks need a break from all taxes.
And yes, surprise, surprise: this proposal to cut insurance-premium taxes is coming from a Democrat.