After months of negotiations House and Senate leaders have reached a budget agreement. While final details of the budget are being ironed out, Speaker Destin Hall and Senate President Pro Tempore Senator Phil Berger shared in a press conference yesterday some of the highlights.

Personal Income Tax Reform

• Personal income tax rate drops to 3.49% for 2027 through 2029
• 3.24% from 2030 through 2032
• 2.99% in 2033 and 2034
• Two revenue triggers for additional 0.25% cuts in the future, with rates potentially dropping to 2.74% and then 2.49%

Constitutional Amendments

• Lower the personal income tax cap to 3.5% from the current maximum of 7%
• Impose new limits on how much local governments could increase property taxes

As we shared yesterday, voters overwhelmingly support both proposed amendments.

Teacher Pay Raises

• Average 8% raise for teachers
• Makes North Carolina the #1 state in the region for starting teacher pay
• Largest raise since 2006
• Bonuses between $500 and $1000

Law Enforcement 

• 20.3% average raise for ALE and SBI agents
• 17.7% average raise for State Highway Patrol officers
• 15.4% average raise for correctional officers
• 10.1% average raise for probation and parole officers
• 13% average raise for other law enforcement officers across state government

State Employees

• 3% raise on average
• Bonuses between $1,000 and $2,000

The conservative, responsible approach to taxes and spending continues the forward thinking that positioned North Carolina as a top state for businesses and has attracted Americans to pursue opportunities here.