New laws, tax cuts, health coverage: 2025 brings changes in North Carolina

Luciana Perez Uribe Guinassi, The Charlotte Observer on Dec 30, 2024

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With the arrival of the new year, change is in the air. But beyond the shifts brought by personal resolutions, several new laws and policy changes are set to take effect in North Carolina.

Here are are three notable ones.

Tax changes

North Carolina’s 2023 budget bill reduces the state’s individual income tax rate across several years.

Starting in January, the individual income tax rate will decrease from 4.5% for 2024 to 4.25% for 2025, followed by a drop to 3.99% the following year.

North Carolina’s corporate income tax will also see changes. For 2025, the tax rate will drop from 2.5% to 2.25%, with further reductions planned in subsequent years, eventually reaching 0% by 2030.

State employee health coverage changes

Aetna is scheduled to assume the role of third-party administrator for North Carolina’s State Health Plan on Jan. 1, 2025, succeeding Blue Cross NC, which has held the position for over four decades.

This transition will impact teachers, state employees, retirees, and their dependents, including with updates to the network of providers.

New laws taking effect

Over a dozen laws are set to take effect with the new year, including parts of Senate Bill 382, a wide-ranging law passed by the GOP-led legislature earlier this month that removes power from incoming Democratic officeholders. Democrats have challenged the law in court, hoping to block parts of it.

The same law also moves $227 million to a Hurricane Helene relief fund but does not allocate it, among various other provisions. Many sections of SB 382 are already in place, but some sections in the bill were set to take effect later.

One section going into effect with the new year permits the General Assembly, starting Jan. 1, 2025, to appoint two new special superior court judges. The speaker of the House will nominate one judge, and the president pro tempore of the Senate will nominate the other.

Campaign finance changes under the bill also take effect. Under current law, political party executive committees and affiliated party committees can establish a political party headquarters building fund. These funds are primarily used for expenses related to a party’s headquarters. The new law allows the money to also be spent on legal actions. That means contributions from previously prohibited sources — including corporations, business entities, and labor unions — can be used for those legal actions.

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