Amends GS 105-130.5(b) by adding a new subdivision allowing a taxpayer, at the taxpayer’s own election, to deduct income, net of expenses, directly attributable to manufacturing activities when determining state net income. Amends GS 105-134.6(b) by adding a new subdivision allowing a taxpayer, at the taxpayer’s own election, to deduct income, net of expenses, directly attributable to manufacturing activities when determining North Carolina taxable income. Rewrites GS 105-130.4(i) to provide that taxpayers electing to deduct manufacturing income pursuant to GS 105-130.5(b)(22) must exclude the following from both the numerator and the denominator when calculating the property factor, the payroll factor, and the sales factor: property used directly and primarily for manufacturing, compensation paid and receipts derived directly and primarily from manufacturing. Provides instances in which certain calculations provided for in the act must apply. Includes General Assembly findings. Amends GS 105-125(a) by adding a new subdivision which exempts from the franchise tax a corporation that derives at least 80% of its annual revenue directly from manufacturing activities. Defines manufacturing in GS 105-228.90(b). Makes other technical and conforming changes. Effective for taxable years beginning on or after January 1, 2012.