Forum discusses who should pay and how much

Monday, March 3, 2003 | 11:34 a.m.

Raising taxes is not the question, participants in a tax forum Sunday agreed. Who should pay and how much, however, is still an issue for debate.

Representatives from the Las Vegas Chamber of Commerce and the state's banking industry said the proposed gross receipts tax, part of a package to generate $1 billion in new taxes for the deficit-strapped state, unfairly puts the bulk of the burden on some businesses.

The forum was aired on Las Vegas ONE, Cox Cable channels 1 and 39, which is partly owned by the Greenspun family, publishers of the Las Vegas Sun.

Absent from the discussion at the University of Nevada, Las Vegas forum were those who are waging a campaign to scuttle the tax increases, noted forum moderator and political commentator Jon Ralston.

Ralston said Assembly members Sandra Tiffany, Bob Beers and Barbara Cegavske, all Republicans who are fighting the tax increases, declined to participate.

Republican Assemblyman Josh Griffin of Henderson, assistant minority leader, said tax increases proposed by Gov. Kenny Guinn, are probably needed -- but so are cuts in government spending.

"There are inefficiencies in state government," Griffin said.

Democrat and Senate Minority Leader Dina Titus agreed that some cuts could be made. But she said any cuts that people have identified come far short of closing the $700 million budget gap that the governor and his task force on tax policy have identified.

And both Titus and Griffin agreed that cutting too much would jeopardize investment in Nevada's economy.

Guy Hobbs, a financial consultant and chairman of the governor's tax task force, agreed. He warned that without a significant investment in government programs, including education, Nevada will experience a "degradation of the public infrastructure."

"If that happens, there will be a definite impact on the community and economic investment," he said.

The legislators soon will have a chance to gauge the strength of support and depth of opposition for the tax proposals.

Griffin said he expects bills that would double the "sin tax" on cigarettes and provide some short-term bridging revenue to come before the Legislature this month. The bills in the Assembly and Senate would provide about $80 million.

The sin taxes that are scheduled to come out of the Legislature this month, however, are not generating the real opposition. The gross receipts tax, a proposal that would tax all businesses receipts above $450,000 a year by 0.25 percent, has raised the ire of the Las Vegas Chamber of Commerce and the banking industry.

"There is a gross inconsistency in the way this tax is applied," argued Robert Forbuss, past chairman of the Las Vegas Chamber of Commerce and a local business consultant.

Bill Martin, Nevada State Bank chairman, said the details on how the gross receipts tax would be applied are still hazy and could be very expensive to implement.

Both Forbuss and Martin said despite their concern about the proposal on the table, neither the chamber nor the banking industry is arguing that they should not have to pay taxes.

"No one has come to me and told the chamber that we just don't want to pay," Forbuss said.

Martin and Forbuss argued that because of the way the tax is structured, companies that generate a lot of business but have low profit margins would be hit harder than businesses with high profit margins. They characterized the issue as one of fairness.

But Michael Sloan, a member of the governor's tax task force and senior vice president of Mandalay Resorts, said the arguments are shorthand for avoiding any significant taxes.

"There are certain big businesses that don't want to pay," Sloan said, pointing out that his industry already pays a gross receipts tax. "Every tax that has ever been proposed, the chamber has found a problem with it."

Whatever happens in the Legislature, it should happen soon, Clark County School Superintendent Carlos Garcia said.

"The sense of urgency seems to be lacking," he said. Garcia said the school district needs to know what kind of funding it has now, while it still has time to recruit the 1,800 new teachers it estimates the school district needs for next year.

"We're really being put at risk," Garcia said.