NORTH CAROLINA – With the lowest corporate income tax in the country at 3%, businesses looking to relocate, expand or start up gravitate toward North Carolina. But a respected business climate ranking released this summer warns the state could lose its competitive edge if it doesn’t address the sacrifice made for those low taxes.
Last month, North Carolina dropped four spots on CNBC’s Top States for Business 2018, from No. 5 in 2017 to No. 9. The reasoning? “A great workforce has businesses sticking with the Tar Heel State, but underfunded schools are infringing on success,” the business news network wrote. It wasn’t the first time the CNBC ranking knocked the state’s education funding. In 2015, North Carolina was depicted as suffering because it “lags in education.” The year before that, a terse admonishment — “must address education” — was prescribed for the state to sustain growth.
Recent state budgets have included pay raises for teachers and increases in education spending. The most recent added close to $700 million for public education and provided an average 6.5% pay raise for teachers. But the argument remains: Is it rising fast enough?