Perdue’s plan would tax sweepstakes parlors

Published 11:10 am Friday, June 8, 2012

RALEIGH – Gov. Bev Perdue says she has an idea that has the possibility of generating as much as $300 million for public school systems statewide.

However, that plan comes at the expense of video sweepstakes parlors and, according to one observer of state government, the low income individuals who visit those businesses.

Perdue’s plan raises additional revenue for classrooms by regulating and taxing the thousands of sweepstakes parlors across North Carolina.

“I’m opposed to sweepstakes. I want to run them out of the state, but we have been unable to do that so far,” Perdue said in a press release issued Thursday. “As long as they are here we should regulate them, tax the heck out of them and use the money to fund our schools.”

The Governor said that under the House budget passed recently, K-12 schools in North Carolina would receive even less funding next year than they’re receiving this year. She added that comes on the heels of all the teacher cuts this year and concerns raised by superintendents.  (Schools are receiving $7.72 billion this year, which includes $258 million in EduJobs money. The House budget provides $7.69 billion.)

In her budget Gov. Perdue proposed restoring ¾ of the one-cent sales tax increase that the General Assembly let lapse last year in order to fill the hole that legislators left in the budget for schools. However, Perdue said the leadership in the General Assembly has been unwilling to consider it.

“The number of children showing up at the schoolhouse door is increasing. The demands on teachers are growing, but legislators are cutting the funding for our schools,” Perdue said. “We need more revenue in order to rescue our schools, and so I’m calling on the General Assembly to consider this alternative.”

She added that after the legislature rammed their cuts through last year, schools were forced to cut 915 teachers, more than 2,000 teacher assistants and nearly 5,000 total jobs in education.

While the Governor thinks it’s a good idea to tax video sweepstakes parlors, Alexandra Sirota, Director of the NC Budget & Tax Center, called the plan “fiscally irresponsible”

“It would ask far more from low-income individuals and communities to fund the education, health, and safety programs that our state’s communities and businesses need to thrive,” Sirota said.

She added that North Carolina needs a comprehensive solution to the state’s budget challenges.

“That means modernizing our revenue system to raise adequate revenue for all the state’s needs. It is troubling that, once again, the Governor has proposed a revenue option that will take a particularly heavy toll on low- and moderate-income communities – communities that are more likely to be marketed to by gaming companies,” Sirota noted.

She continued, “North Carolina’s classrooms and communities need a long-term sustainable approach that fixes the problems with our revenue system, ensuring that students have access to both a quality educational experience and a safe neighborhood in which to grow up. Instead of more revenue from gambling, North Carolina needs serious revenue reform that broadens the base of the sales tax, ensures that the personal income tax remains based on ability to pay, and strengthens the corporate income tax so that profitable corporations pay their fair share towards building a stronger North Carolina.”