Wynn’s tax break compromise gains OK from committee

Thursday, April 8, 1999 | 10:41 a.m.

Chairman Mike McGinness, R-Fallon, says SB521 was approved 6-1 by his committee. Sen. Joe Neal, D-North Las Vegas, cast the only "no" vote.

Moments before, the committee voted 4-3 to kill Neal's SB90. It would have repealed a law passed two years ago that allowed wealthy art collectors sales tax exemptions if they displayed their art publicly.

Neal made the art tax break for Wynn one of the primary issues of his unsuccessful campaign for governor last year. After Neal waged his battle over the tax exemption, Wynn made his proposal for half-price tickets for Nevadans.

SB521 would allow art collectors, such as Wynn, to charge admission to their collections and still claim a state sales tax exemption.

Wynn's representatives testified last week that he didn't need the tax exemption because he was an art dealer and that the art in the $300 million Bellagio collection was for sale. People who bought the art would pay the full sales tax rate.

"I think it was an outstanding compromise," McGinness said of the Wynn bill. "It addresses the problems the Nevada Tax Commission had with the original bill."

Wynn last summer sought the sales tax break approved in 1997 but was refused by the Tax Commission because he charged a $12 admission fee to the Bellagio gallery.

McGinness said he liked the bill because of the Nevada discount and the guarantee that schoolchildren could visit the gallery for free on 20 days per year.

In addition, the bill would obligate Wynn to give whatever proceeds he gets from admissions to charity after he deducts direct costs, such as security and humidity equipment in the gallery.

SB521 would allow people who buy art valued at more than $25,000 and display the works publicly to claim an exemption on 71 percent of the 7 percent sales tax. They also would get a local property tax break.

The art works would have to be displayed publicly at least 20 hours per week for 35 weeks a year to be eligible for the tax benefit.

Wynn would have been subject to $18 million in sales and property taxes on his art purchases.

During testimony last week, Wynn lobbyist Harvey Whittemore said Wynn has sold $10 million worth of art and has had an art dealer's license since November 1997.