(RALEIGH) -- Work continues on the state budget, and one of the most controversial issues has been the state's corporate income tax. NC State Economics Professor Mike Walden says the governor's proposal to lower the tax could be a good thing for the state, "the lower corporate income tax is a very wise move on the part of the governor."

North Carolina's corporate rate now ranks 26th in the nation but the highest in the Southeast, according to the nonpartisan Tax Foundation. If Governor Perdue's proposal were enacted by the legislature, North Carolina would have the third-lowest corporate tax rate in the nation - behind only Colorado and oil-rich Texas.

Dr. Walden expects clashing between the GOP-led legislature and the Governor regarding one key area of her budget proposal. Walden comments, "I think the big battle between the governor and the general assembly will be over the retention of the temporary sales tax increase." Perdue's budget keeps most of the one-cent temporary sales tax. Republicans have pledged to let expire.

Meanwhile the State House today is scheduled to debate on whether to accept Senate changes to a measure related to the 2010 federal health care overhaul law. The bill seeks to block a provision requiring most people buy health insurance or face a penalty. Perdue stated last week that while she may not veto the bill when it hits her desk, she may not sign it either.  The bill, with or without the governor's signature, would become law ten days after she receives it.