Senate gives second-reading approval to 2026 budget conference report
The Senate gave second-reading approval July 1 to the conference report for Senate Bill 257, the 2026 Appropriations Act.
RALEIGH — The North Carolina Senate gave second-reading approval Wednesday to the conference report for Senate Bill 257, the 2026 Appropriations Act, moving the state budget bill through another major legislative step.
The bill page lists the last action as “Conf Report Passed 2nd” on July 1. The conference budget carries broad statewide fiscal and policy implications, including changes to income tax rates, insurance taxes, sports wagering taxes, court fees, environmental fees, transportation fees, state fund interest transfers and other state revenue provisions.
A legislative fiscal memo dated July 1 says the budget would increase General Fund revenue by $317 million in fiscal year 2026-27, $1.48 billion in fiscal year 2027-28, $2.94 billion in fiscal year 2028-29, $2.5 billion in fiscal year 2029-30 and $1.87 billion in fiscal year 2030-31.
The memo says the conference budget would repeal conditional personal income tax rate reductions between 2027 and 2034 and set the tax rate at 3.49% in 2027, 3.24% in 2030 and 2.99% in 2033. The fiscal memo states the bill would also authorize up to two future rate reductions between 2035 and 2040 if General Fund revenue meets specified triggers.
Other revenue provisions listed in the memo include repealing the sales tax exemption for electricity used by data centers, increasing the sports wagering tax rate from 18% to 23%, creating a 6% tax on prediction market net trading fee revenue, changing vapor product licensing rules, increasing certain court and criminal justice fees and directing the N.C. Board of Transportation to set tolls on ferry routes consistent with a vessel replacement schedule.
The measure is one of the most significant bills moving through the General Assembly because it would affect tax policy, state agencies, courts, transportation, education, health programs, local governments and other public services statewide.
Editor’s note: This article was drafted with the assistance of artificial intelligence and was reviewed and fact-checked by a member of the NC Political News editorial team before publication.
