North Carolina: The Tar Heel State

North Carolina is located in the east, on the Atlantic coast, of the United States. The area of ​​140,000 km² is bounded by South Carolina and Georgia to the south, Tennessee to the west and Virginia to the north. With a population of just over ten million, North Carolina is the ninth most populous US state. According to ehuacom, the capital, Raleigh, is the second largest in the Tar Heel State after Charlotte.

North Carolina’s economy is fueled by low cost of doing business, pioneering university research and excellent infrastructure. Talented workers are attracted by the high quality of life.

In the past five years alone, German companies have invested over a billion dollars in North Carolina, creating over 8,500 new jobs. The resident German companies include Bayer, Daimler and Deutsche Bank.

North Carolina Location Map

TOP CLASS BUSINESS CLIMATE

North Carolina is consistently recognized for its business-friendly climate. As of 2017, the state has been named “Best State For Business” by Forbes three times in a row.

The Tar Heel State has a proven track record of lowering and simplifying corporate taxes. At 2.5 percent, the state has the lowest corporate tax rate in the country. This is intended to encourage companies to grow.

Construction costs that are 16 percent below the national average, electricity costs that are 10 percent below the national average, and the cost of living that is up to 12 percent cheaper than the national average in major metropolitan areas — North Carolina scores highly on many key indicators. The costs of doing business are among the lowest in the nation, making the state one of the most profitable places for entrepreneurs and businesses.

Recent tort law reform, streamlined procedures and strengthening of the state’s commercial courts have earned North Carolina awards and rankings among the best legal climates in the United States. Legal hurdles don’t stop companies, they make faster progress and can thus climb new levels in a timely manner.

PRIME LOCATION

The unsurpassed East Coast location means nearly half of the US population is within a day’s drive. The excellent road and rail network enables efficient transport of all goods to various destinations in North America.

The seventh busiest airport in the world is in Charlotte, North Carolina. Almost every major city in the world can be reached within a flight change. The state has a leading air cargo hub at Piedmont Triad International Airport (GSO), which is home to the FedEx Mid-Atlantic Air Hub. The state is also home to ten commercial services airports and more than 100 general aviation facilities.

There are also two deep-water ports on the North Carolina coast that offer fast turnaround times and capacity for ships carrying up to 14,000 standard 20-foot containers. Additionally, a river port in Charlotte lies at the heart of the Southeast’s manufacturing and distribution bases.

HIGHLY QUALIFIED AND INNOVATIVE

North Carolina enjoys three universities that are at the forefront of research. The community college workforce training system spans 58 training institutions.

Across the Tar Heel State, talented workers are patenting new ways to work smarter. With patent growth of 70 percent over the past decade, North Carolina companies are the nation’s leaders in innovation. The rich resources, highly skilled workforce, and renowned education systems all contribute to the state’s forward-thinking ingenuity.

NORTH CAROLINA INCOME TAX

North Carolina charges an income tax of 5.25%. In addition, federal income taxes are payable.

CORPORATE INCOME TAX IN NORTH CAROLINA

North Carolina charges a 2.5% corporate income tax. In addition, federal corporation tax is payable.

NORTH CAROLINA SALES TAX

There is no sales tax or Value Added Tax (VAT) in the USA based on the European model. Instead, in the United States, states, counties, and municipalities levy a local sales tax on the sale of products (but not services).

Sales Tax Rate in North Carolina

The sales tax in North Carolina is 4.75% at the state level. Municipalities or districts charge an average of 2.23% sales tax. Combined, an average of 6.98% is due.

North Carolina Nexus Laws & Sales Tax

Learn more about the Economic Nexus Laws in the context of Sales Tax here.

Effective Date

November 1, 2018

Transactions included:

Gross Sales from North Carolina (the sum of the total selling price of tangible personal property, digital property, and services sourced to the United States state, unless the context otherwise requires).

Treatment of tax-exempt transactions:

Exempt Sales and Exempt Services are included in the threshold

Reason:

sales or transactions

Sales/Transactions Threshold:

$100,000 or 200 transactions

Evaluation period:

The threshold applies to the previous or current calendar year

Extra information:

  • Registration Requirements: North Carolina requires that a remote business register to collect and remit North Carolina sales tax within 60 days of crossing the Economic Nexus Threshold. See Remote Salesfor more information.
  • Information for Remote Sellers
  • SB56

North Carolina Marketplace Sellers & Sales Tax

Learn more about Marketplace seller registration requirements

Effective date by the marketplace broker:

February 1, 2020

Economic Nexus Threshold:

More than $100,000 in gross sales or more than 200 separate transactions in North Carolina in the previous or current calendar year. Remote sellers should include sales through a marketplace in the calculation of the threshold. Marketplace intermediaries include all sales made through the marketplace when calculating the threshold.

Registration requirements:

  • Remote Multichannel Sellers: You must register with the North Carolina Department of Revenue and collect North Carolina sales tax on sales that are not taxed by a Marketplace Agent once you have crossed the Economic Nexus Threshold.
  • Remote Marketplace Sellers: You may need to register once you cross the Economic Nexus Threshold. To do this, contact the North Carolina Department of Revenue for more information.
  • In-State Multichannel Sellers: You must register with the Department of Revenue and collect taxes on sales that are not taxed by a marketplace intermediary.
  • In-State Marketplace Vendors: You may need to register; Contact the Department of Revenue for more information.