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How is sales tax split among city, county and state?

Ken Little

Here are the numbers and additional comments by city of Wilmington spokeswoman Malissa Talbert.

Of the 8 percent retail sales tax, 5.75 percent is state and 2.25 percent is local. Of the local 2.25 percent portion, 0.25 percent goes to New Hanover County only, with the remaining 2 percent allocated between the city and the county governments in proportion to the total amount of ad valorem taxes levied by each jurisdiction.

The last certified tax assessed values by the N.C. Department of Revenue yields the following allocation, according to the city:

  • New Hanover County — 74.2704 percent.
  • Carolina Beach — 2.0015 percent.
  • Kure Beach — 0.7369 percent.
  • Wilmington — 21.7637 percent.
  • Wrightsville Beach — 1.2275 percent.
  • Talbert said that although over 80 percent of all sales occur inside Wilmington city limits, Wilmington [Map this] only receives 21.7637 percent of the sales tax revenue produced.

    North Carolina’s General Statutes give counties the sole right to determine how sales tax is distributed within the county. There are two choices.

    The first is on an ad valorem basis (who has the highest tax levy).

    The second is population.

    “New Hanover chooses the first option. The resulting disparity in the revenue distribution causes taxpayers inside the city limits to carry the brunt of the expenses related to transportation, public safety and solid waste, services highly impacted by visitors,” Talbert said.

    “Basically, Wilmington’s tax rate is higher than would be necessary if Wilmington received a larger share of the sales tax revenue,” she said.

    User-contributed question by:
    Mike D

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