James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Clash Over Corporate Tax in North Carolina Utilities Commission
Author: James F. McDonough
Date: October 22, 2014
Key Contacts
Back
A decision by the North Carolina Utilities Commission has triggered internal protest that highlights a rift between Democrats and Republicans.
According to NewsObserver.com, the commission has ruled that the state’s utilities can continue to charge their customers for a corporate tax rate higher than the rate that they actually pay. This decision has introduced strong tensions between the commission’s Democratic minority – who controlled the commission for years – and a Republican majority recently put into place by Gov. Pat McCrory.
In a 4-3 decision, the commission ruled that North Carolina utilities can continue to charge consumers for a corporate income tax of 6.9 percent, despite the fact that the state’s corporate income tax was recently lowered to 5 percent by state legislature, the news source reported. Utility companies are allowed to pocket the difference.
“There is no set end to this over-collection, which will continue indefinitely each year until each utility’s next general rate case,” the commission’s three Democrats wrote in their dissent, according to the news source. “Even then, ratepayers will never be refunded the over-collected funds; the utilities have simply been afforded an unearned gain at the expense of North Carolina ratepayers.”
Utility Dive reported that the state’s utilities would be able to over-collect approximately $21 million per year based on the ruling. Ratepayers’ average electric bills would increase by about 1 percent and average natural gas bills would increase by between 3 and 4 percent.
The majority wrote in their decision that the amounts considered are too small to require a change, according to NewsObserver.com. Duke Energy Carolinas and Duke Energy Progress are two companies opting to pass the savings on to consumers. They noted, however, that their customers would likely only pay 9 cents more and 17 cents more per month extra, respectively.
- Practices: Tax and Trusts & Estates, Corporate Tax Planning, Sophisticated Estate Planning & Wealth Preservation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Supreme Court and Title VII: Implications for Reverse Discrimination
Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]
Author: Matthew F. Mimnaugh
SPACs Are Back, What You Need to Know
Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]
Author: Dan Brecher
Short Form Merger: Streamlining the Process for Businesses
Merging two companies is a complex legal and business transaction. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process that involves important corporate governance considerations. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process. However, […]
Author: Dan Brecher
Tariff Response Options for Small Businesses Facing Financial Distress
The Trump Administration’s new tariffs are having an oversized impact on small businesses, which already tend to operate on razor thin margins. Many businesses have been forced to raise prices, find new suppliers, lay off staff, and delay growth plans. For businesses facing even more dire financial circumstances, there are additional tariff response options, including […]
Author: Brian D. Spector
Common Causes of Partnership Disputes and How to Resolve Them
Business partnerships, much like marriages, function exceptionally well when partners are aligned but can become challenging when disagreements arise. Partnership disputes often stem from conflicts over business strategy, financial management, and unclear role definitions among partners. Understanding Business Partnership Conflicts Partnership conflicts place significant stress on businesses, making proactive measures essential. Partnerships should establish detailed […]
Author: Christopher D. Warren
Businesses Are Facing Financial Headwinds—A Practical Guide
*** The original article was featured on Bloomberg Tax, April 28, 2025 — As a tax attorney who spends much of my time helping people and companies who have large, unresolved issues with the IRS or one or more state tax departments, it often occurs to me that the best service that I can provide […]
Author: Scott H. Novak
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.