Amusement tax weighed

Erin Neff

Monday, June 24, 2002 | 11:22 a.m.

Taxpayers could be facing a blockbuster add-on to their $8.50 movie ticket or the DVDs, videos and games they pick up for the family's weekend viewing.

An amusement tax is being analyzed by the Nevada Taxpayers Association as a way to raise revenue from people who have the discretionary spending to go to movies, concerts, nightclubs and some sporting events.

Carole Vilardo, president of the taxpayers group, is preparing recommendations approved by her board to the Nevada Task Force on Tax Policy that will include a proposed amusement transactions tax.

The task force is studying ways to remedy a state fiscal crisis by broadening the tax base and stabilizing the current system. Since 75 percent of Nevada's general fund comes from sales and gaming taxes, the state is vulnerable to lower revenues during economic downturns.

Vilardo said her group analyzed a 3.7 percent amusement tax -- which could be used to replace the existing casino entertainment tax -- in an effort to broaden the tax base.

The 10 percent casino amusement tax, an add-on to the gaming tax covering admissions to live entertainment events in most gaming properties, generated $58 million in the last fiscal year.

A 3.7 percent amusement tax -- which would be applied to a wider range of activities -- would generate $63 million. But if that tax were assessed at the same 10 percent as the current casino entertainment tax, it would generate $181 million a year.

Bill Bible, president of the Nevada Resort Association, said he would have to see the specific proposal before determining whether the casino industry would support such a change.

"It is a proposal that warrants the appropriate study and analysis," Bible said.

Vilardo said the proposal makes good tax sense, in that people who typically take part in the activities that would be subject to the new tax could afford to pay it.

"It is a progressive tax in that the poorest residents spend very little of their money on amusements," Vilardo said.

The average Nevada family spends $560 a year renting and going to movies and attending concerts and events.

The amusement tax would be aimed more squarely at tourists, who annually outnumber residents 23-to-1 and who would be taxed for sightseeing tours, entrance to cabarets and other entertainment activities targeting visitors.

The proposed amusement tax would apply to all venues with 2,700 or more seats, including the Thomas & Mack Center. However, all high school and college sporting events would be exempt.

Jeremy Aguero, an economist for Applied Analysis of Las Vegas, has prepared an analysis of the amusement tax for Vilardo's group. He is also chairing the technical working group assisting the tax task force.

Aguero said an amusement tax would broaden the tax base because of its wider implementation.