Lawmakers say healthy profits report advances gaming tax argument
Wednesday, Feb. 5, 1997 | 11:59 a.m.
The tax issue arose following release Tuesday of an annual report showing Nevada hotel-casinos earned record pre-federal tax profits of $1.36 billion in fiscal 1995-96.
The Gaming Control Board reported the clubs had pre-tax profits equivalent to a 10.6 percent return on revenues of $12.8 billion.
Most of the profit was made by the largest Las Vegas Strip casinos: $981.9 million of the total, for a 16.2 percent return on revenues of $6.1 billion.
Some legislators say a gaming tax increase ought to be among the issues discussed discussed if it can be shown taxes are needed to improve infrastructure in Las Vegas.
Assemblywoman Chris Giunchigliani, D-Las Vegas, said last summer's message from "the powers that be" was that "everybody was going to share in the pain" if taxes must be increased to pay for such improvements.
The Southern Nevada Water Authority has proposed a quarter-cent increase in the sales tax rate in Clark County to partly fund $1.7 billion in water and sewer improvements.
"I have a real concern about that (sales) tax," Giunchigliani said. "It is regressive and adversely affects my senior citizens and lower income people."
But Assemblyman David Goldwater, chairman of the Committee on Infrastructure, said he isn't considering any tax increases at this time.
"We have a tax on gaming, don't we?" asked Goldwater, D-Las Vegas, rhetorically. "We will see what we need when the hearings come."
Sen. Bob Coffin, D-Las Vegas, said it's too soon in the session to talk about any tax increases. The Legislature isn't expected to conclude business before July.
"Gaming has come to the table before," he said. "But not this early in the session."
The gaming industry has been adamant in its opposition to increasing the 6.25 percent gaming revenue tax, unchanged since 1989. But a statewide poll released last Friday showed 69 percent of respondents favor a gaming tax increase.
Richard Bunker, president and lobbyist for the Nevada Resort Association said, "I haven't heard about any moves for an increase. I still do not believe the governor, or the Legislature, are calling for any increase in the gaming tax."
Budget Director Perry Comeaux said he knows of no change in Gov. Bob Miller's opposition to any tax increases.
Fiscal 1995-96 marked two consecutive budget years of 10.6 percent profits. In fiscal 1994-95, the industry earned pre-tax profits of $1.28 billion on revenues of $12 billion.
The gaming industry voluntarily agreed to a phased-in tax increase in 1987. Faced with a move by then-Sen. Don Mello, D-Sparks, to raise the tax to 8 percent, the industry agreed to a quarter-cent increase in 1987 and another quarter-cent increase in 1989.
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