On Wednesday, members from both the House and the Senate agreed to send the tax package proposal -- which the Senate passed Tuesday -- to a conference committee. The committee consists of legislative leaders from both chambers.
The Senate's $1 billion tax package could be large enough to fill a fiscal hole in the budget and could end debate about how to increase state revenue.
Sen. Howard Lee, D-Orange, who is the chairman of the Senate Appropriations Committee, said Gov. Mike Easley supports the chamber's tentative budget. Easley threatened earlier in the week to veto a budget that included only the House's proposal, which would raise $700 million in the next two years.
"There is a tentative budget with which the governor agreed and, therefore, there is no reason for Governor Easley to veto," Lee said.
The tax package will be added to the budget in conference committee, and the full budget could be approved by both chambers as early as Friday.
But Senate Minority Leader Patrick Ballantine, R-Carteret, said members of his party are not pleased with lumping the two bills together.
Ballantine added that the tax increase is larger than expected.
"This is the largest tax increase by any legislature in the country this year," he said. "This tax increase is the only one that raises taxes on personal income, and this is the only state that raises the sales tax."
The budget discussion began in February, and legislators hoped to pass a budget by July 1, the start of the fiscal year. But competing tax plans have caused a standoff between the House and Senate.
