Neal goes after taxes again for Bellagio’s art

Friday, March 12, 1999 | 10:21 a.m.

CARSON CITY -- Sen. Joe Neal, the most vocal critic of the gaming industry in the Legislature, introduced a bill Thursday that would eliminate the special tax break for the Bellagio's art collection.

Current law exempts certain collections of fine art that are open to public viewing from personal property taxes as well as most sales taxes -- except the constitutionally mandated 2 percent state sales tax. In Clark County, the sales tax ordinarily would be 7.25 percent.

"They are not paying what they should be paying," Neal, D-North Las Vegas, said. "The first year, they would save about $17 million or $18 million from this. That's just not right. The state could use that money for schools and other things."

But Harvey Whittemore, a lobbyist for Mirage Resorts, said the state is benefiting from the tax exemption. He added he believes that the $300 million art collection at the Bellagio is exempt from the taxes anyway because it is inventory that will be sold.

This explanation left Neal scowling.

Whittemore said the state benefits from the bill because it encourages art collectors to share their collections with the public by displaying them.

Opponents of the bill also say the state benefits because the art attracts people to the casino, where they will presumably gamble and generate more state revenue through the gaming tax.

Under current state law, the art must be publicly displayed 20 hours per week for at least 35 weeks a year.

Mirage Resorts is currently suing the Nevada Tax Commission over this issue. In November, the tax commission ruled the intent of the legislation was for the art to be displayed free of charge to the public. The Bellagio is charging $12 to view the exhibit.

Whether Mirage is currently complying with the provisions of the tax exemption passed in 1997 may be decided in court.

Meanwhile, Neal says he is optimistic that the Legislature may dump the exemption altogether.

"I think it will pass out of committee and will pass when it gets to the floor," he said.