NC Senate takes up 'compromise' tax reform plan

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RALEIGH, N.C. (AP) — North Carolina senators are taking up a new tax reform proposal that eventually repeals corporate taxes without adding new sales taxes to services.

The proposal headed to the Senate Finance Committee on Wednesday marks a dramatic shift from an earlier proposal that added new sales taxes to more than 100 services. The proposal also repeals local taxes on food by 2016.

Senate Leader Phil Berger of Eden described the plan as a compromise that will fuel growth. Democrats called the plan a "charade" that will require severe reductions to services or shifting tax burdens to pay for billions of dollars in cuts.

The plan is the latest in a series of proposals from House and Senate Republicans to reform what is widely considered an outdated tax system.

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