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RALEIGH (AP) — House Democrats moved forward on a North Carolina state budget proposal Monday night by announcing a proposed $940 million tax package for next year that would raise rates for sales and income taxes, cigarettes and alcohol.

The tax deal, debated behind closed doors in the Democrats' caucus for nearly two hours, also would expand the number of services that would be subject to sales tax.

But they weren't unified about the package.

Some liberal Democrats wanted more revenues to remove the most painful cuts used to narrow an unprecedented $4 billion-plus budget gap. Others in tobacco-growing regions were unhappy were with a 25-cent-per-pack increase on the cigarette tax on top of a 62-cent increase by Congress earlier this year.

The chief architect of the tax plan acknowledged the deal wasn't a slam dunk to cull together the 61 Democrats needed to help pass the budget bill, hopefully by week's end. Democrats have a 68-52 advantage in the chamber, and it's unlikely that any Republicans would vote for a spending plan that requires new taxes.

"Our thinking is one day at a time," said Rep. Paul Luebke, D-Durham, senior co-chairman of the House told reporters. "The revenue package has some things that just about every member likes to an extent and every member dislikes to an extent."

The plan would change the sales tax rate most people pay from 6.75 percent to 7 percent, while two new income tax brackets would be created for the state's highest wage earners — those making at least $200,000. The state cigarette tax also would go up to 60 cents a pack.

The Senate's budget approved in April also proposed raising taxes by $500 million, but the measure didn't provide details on how that would be reached.

Senate Democrats later in the month unveiled a proposal that would have reduced sales and income tax rates in exchange for expanding the number of services covered by the sales tax more so than the House. Cigarette and alcohol taxes also would be raised. But the package hasn't been approved by the chamber.

Once the House passes a budget bill, Democratic negotiators from both chambers will work toward a compromise to present to Gov. Beverly Perdue, who urged House members earlier Monday to support new taxes to balance the budget.

"With North Carolina facing an unprecedented budget shortfall, I call on House members to utilize a combination of spending reductions and new revenue in their budget," she said in a prepared statement.

Luebke said the money would be used to reduce some proposed cuts in education and health care, such as increasing class sizes in the public schools and restoring some proposed rate cuts for doctors and hospitals that treat Medicaid patients.

"Revenue raised in this package directly links to restoration of certain programs in education and health and human services," Luebke said.

The House Finance Committee will consider the tax package Tuesday morning about the same time the chamber's chief budget-writing committee considers a $17.8 billion spending package.

If the finance committee approves the package, the amount of the budget will be increased, said Rep. Mickey Michaux, D-Durham, senior co-chairman of the House Appropriations Committee.

"If we can restore these cuts ... that will at least help a lot," Michaux said. Some of the extra funds would be set aside in the state's rainy-day reserve fund, which will be empty otherwise.

House Minority Leader Paul Stam, R-Wake, said Democrats wouldn't have to see new taxes if they had prioritized spending and eliminate more ineffective programs.

"I'd be surprised if there are any (Republican) votes for it," Stam said.