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UPDATED: DEMOCRAT FILES FIRST MAJOR TAX BILL: With a bipartisan list of sponsors, Charlotte Democratic Sen. Dan Clodfelter beat Republicans to the punch on tax overhaul legislation. Clodfelter filed a bill Thursday to lower personal and corporate income taxes, as well as the state sales tax with a more modest expansion of taxable services. One big proposed change: a flat income tax rate at 6 percent, instead of three-tiered structure now, as well as exempting the first $11,000 in income from taxation. Clodfelter said it would help all taxpayers but especially low- and middle-income residents.

McCRORY SAYS NO INCOME TAX ELIMINATION: Gov. Pat McCrory, who campaigned on a plan to significantly lower personal and corporate income taxes and possibly eliminate them, is now conceding ground. McCrory took his budget tour on the road Thursday to Wilmington. The Star-News reported: "Even though McCrory cited the state’s tax system as a disadvantage in competition with South Carolina and Virginia, he said it was not possible now to eliminate the personal or corporate income taxes as part of his upcoming tax reform proposals."

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Economist Art Laffer told state lawmakers that the movement to overhaul the tax code in North Carolina is crucial to the national "fight for a different sort of economics."

"You are wearing the white hat," he said. "Don't let them take the white hate off you. Go to the goal line."

Laffer, the conservative economist and trickle-down believer, gave the keynote address at a "training" for state lawmakers hosted by the Civitas Institute, a conservative political organization.

The event featured presentations from a number of state lawmakers from outside North Carolina who are members of the American Legislative Exchange Council, known as a ALEC, a controversial group that pushes "model legislation" based on conservative ideology.

GOP FLIRTS WITH CHARLOTTE: Could Charlotte do for Republicans in 2016 what it did for Democrats in 2012? The Republican National Committee’s meeting in Charlotte this week has fueled speculation that the GOP might return for its national convention in four years. “It’s always a possibility,” GOP Chairman Reince Priebus said Wednesday at the Westin hotel. “North Carolina was good to us. And it’s a red state – all the more reason to look at Charlotte.”

AFP TOUTS GOP REIGN IN NORTH CAROLINA: Tim Phillis, the national president of Americans for Prosperity, writes in a Politico op-ed that North Carolina is a state where the GOP plans to make a difference. It starts: "In Raleigh, N.C., on Jan. 11, a new free-market Republican governor celebrated his gubernatorial win at the inaugural balls. The occasion was historic for North Carolina: the first time since Reconstruction that a conservative GOP governor will be joined by free-market GOP state legislative majorities in both state legislative chambers." Read full piece here.

***This is the Dome Morning Memo a digest of important N.C. political news. Click below for more.***

TODAY'S BIG STORY: Republican lawmakers outlined a proposal Wednesday to revamp the state’s tax system, offering a slew of reforms that would radically shift the tax burden in North Carolina. The proposal would eliminate personal and corporate income taxes in exchange for higher state sales taxes levied against groceries, medical expenses and other currently tax-free services.

SUPPORTERS SAY: Senate leader Phil Berger said the moves are necessary to modernize the state’s tax code and kick-start a struggling economy. He pointed to the state’s tax rates, saying the current 6.9 percent corporate tax rate and 7.75 percent personal tax rate for the highest earners are among the highest the region. “It is important for us in terms of our competitive posture with other states,” the Republican from Eden told reporters. “It is important for us in terms of making sure there is a fair allocation of the cost of government.”

CRITICS SAY: Critics caution that the proposals represent a fundamental change in who pays the state’s tax burden, and economists said that low-income people would feel the brunt. “For this particular proposal, the responsibility would shift from rich households and prosperous corporations to poor households and smaller businesses,” Dave Ribar, a professor at UNC-Greensboro, concluded in his analysis of the proposal.