Lack of Nevada income tax touted as key in recruitment

Friday, Aug. 22, 2003 | 11:38 a.m.

Economic development executives recruiting businesses to Nevada should continue to emphasize the state not having the most intrusive of taxes -- a personal income tax -- the leader of a watchdog group says.

Carole Vilardo, executive director of the Nevada Taxpayers Association, told a session of the Nevada Economic Development Conference that recruiters should continue to emphasize the state's strong low-tax position, though she said she was exasperated by the recently concluded session of the Nevada Legislature that raised taxes $836 million.

Vilardo was one of four workshop leaders Thursday at the two-day conference that was to conclude today in Las Vegas. About 130 people from around the state registered for the event, coordinated by the Nevada Commission on Economic Development.

"An income tax may be the fairest tax, but it's also the most intrusive in people's lives," Vilardo said. "One thing you can say about Nevadans, they don't like government intrusion in their lives."

She said recruiters should emphasize that point when selling the benefits of the state to companies considering moving or expanding into Nevada.

Somer Hollingsworth, president of the Nevada Development Authority, has said that the new slate of taxes approved by lawmakers shouldn't affect the state's ability to recruit companies.

Hollingsworth told In Business Las Vegas, a sister publication of the Sun, that in their trips, Nevada recruiters can still brag that the state has no corporate or personal income taxes.

He said Nevada didn't lose any ground to rival states because it still compares favorably with Arizona, Utah and New Mexico on the tax front. Recruiters also are turning up the heat on California.

The NDA and the Commission on Economic Development are spearheading a statewide effort to recruit vigorously in the Golden State by introducing an advertising campaign earlier this month in several business journals. The ad proclaims, "You're out of business," and lists California's workers' compensation, utilities and paid Family Medical Leave Act expenses as reasons for considering a move to Nevada.

Vilardo argued that even though Nevada approved several new taxes, the state still compares favorably with other states.

In her presentation, she listed the various taxes approved by lawmakers in a recent special session and she said she was most frustrated by the fact that legislators combined several tax proposals into a hybrid that wasn't given time for debate. She encouraged people attending the session to attend regulatory hearings at which details of tax laws would be drafted and unclear aspects of some laws would be explained.

"Anybody who is interested enough to hear about the details of the tax laws today and anybody who followed the Legislature through the last few months should also be interested enough to attend some of these regulatory hearings," she said.

She said she expects the tax that may get the most attention from businesses that could be recruited to Nevada is the 0.7 percent tax on gross payroll that lawmakers enacted. Vilardo said important recruitment points, however, are that the payroll tax will be reduced to 0.65 percent after one year and that employers offering health plans can receive a tax reduction for every dollar in health benefits offered to their employees.

Vilardo said a key clarification on the dollar-for-dollar reduction is that it only applies on benefits to Nevada-based employees.

In another matter at the conference, economic development leaders agreed to resurrect an association dedicated to recruitment issues.

Mike Majewski, director of economic development for the City of North Las Vegas, was elected president of the revamped Nevada Economic Development Association.

Majewski said the organization would not replace the recruitment efforts of the approximately 25 city, county, regional and statewide economic development organizations in the state. He said it will establish a communications network for issues of common concern for those organizations.