North Carolina is among the states with the lowest effective business tax rates in the country. Our state maintains the highest rating (AAA) from all three major bond rating agencies. In North Carolina, only the state has the authority to tax corporate income and there is no state property tax. Additionally, there is no tax, state or local, on inventories or intangibles.
The North Carolina Corporate Tax Rate is 2.5%. Of the 44 states that levy a corporate income tax, North Carolina has the lowest rate. In 2025, the rate will decrease to 2.25% with a planned decrease to 2% in 2026; 1% in 2028; and a decrease to 0% in 2029.
Real and personal property are taxed by the local government, with a single property tax assessment in each county. The value determined by the county assessor constitutes the base for all levies, including those of cities and towns on property located within the municipality. Property is assessed at 100% of its appraised value.
|County/Municipality – FY 2020-2021||Tax Rate Per|
|Town of Enfield||$0.927|
|Town of Halifax||$0.66|
|Town of Hobgood||$0.72|
|Town of Littleton||$0.80|
|City of Roanoke Rapids||$0.651|
|Town of Scotland Neck||$0.785|
|Town of Weldon||$0.720|
|Rate does not include special assessments, which are location specific.|
Retail sales of tangible personal property not subject to a reduced rate of tax are subject to the 4.75% general State rate of sales or use tax and a 2.25% local rate (combined 7%).
North Carolina offers tax exemptions and allowances for manufacturers:
1.0% (first 2 years) – New Employer Tax Rate
0.06% – Minimum Tax Rate
5.76% – Maximum Tax Rate
$26,000 – Taxable Wage Base (per employee)
The NC Franchise tax rate is $1.50 per $1,000 of the net worth apportioned to North Carolina.
For a S Corporation, the tax rate is $200 for the first $1 million of the corporation’s tax base and $1.50 per $1,000 of the tax base exceeding $1 million.
The North Carolina Personal Income Tax Rate is a 4.99% flat rate. Personal income tax rates decrease to 4.75% in 2023; 4.6% in 2024; 4.5% in 2025; 4.25% in 2026; and 3.99% in tax years after 2026.
In 2022, the standard deduction increased to $25,500 for married couples and surviving spouses; $19,125 for heads of households; and $12,750 for single taxpayers and those married filing separately.
A local occupancy tax on the rental of rooms and lodging is levied in Halifax County primarily for the purpose of generating revenue to promote travel and tourism. Halifax County’s occupancy tax rate is 5%. Within the City of Roanoke Rapids, the occupancy tax rate is 6%.
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