Highlights of Nevada tax increase plan

Wednesday, March 5, 2003 | 11:06 a.m.

Gov. Kenny Guinn's $1 billion tax proposal includes the following elements, designed to support state spending, avert a revenue shortfall and broaden a narrow Nevada tax base:

-Total tax increases of nearly $1 billion over the next two fiscal years, plus an additional $74 million in increases from April through June.

-Starting April 1, increasing the $100 per employee annual business license tax to $300. The new tax would bring in about $180 million per year. It would drop to $80 per employee once a proposed gross receipts tax takes effect in mid-2005.

-Starting April 1, increasing the 35-cent per pack cigarette tax to $1.05. The increase would raise the price of a $3.50 pack of cigarettes to $4.20 and bring in $120 million per year.

-A 0.25 percent gross receipts tax on all business revenue above $450,000 in one year, starting in July 2005. A business with annual revenues of $1 million would pay about $1,375. The tax would generate more than $220 million per year.

-A 0.25 percentage point increase in the gross gaming tax starting in July 2005 from 6.25 percent to 6.5 percent. The increase would bring in about $25 million per year.

-A 7.3 percent tax on admissions to movies, professional sporting events and strip clubs, and other amusements. Videocassette and DVD rentals were dropped from the plan. The new tax would produce about $82 million per year. Guinn would support an amendment to tax participatory sporting events, such as golf. That could raise up to another $20 million.

-A property tax increase of 16 cents per $100 in assessed value starting July 2004. The owner of a $200,000 home would pay an additional $105 per year. The increase would bring in $100 million per year.

-An 89 percent increase in alcohol taxes. The beer tax, now 9 cents per gallon, would increase to 17 cents. The wine tax, now 40 cents per gallon, would increase to 76 cents per gallon. The liquor tax, now $2.05 per gallon, would increase to $3.87. The tax would increase the price of a six-pack of beer by about 4.5 cents, and the price of a 750-milliliter bottle of whiskey by about 36 cents. The tax would bring in about $17.5 million per year.

-A 50 percent increase in fees charged by the secretary of state's office to incorporate businesses. The tax would generate about $30 million per year.

-Recommendation that the Legislature consider levying sales taxes on some untaxed professional and discretionary services, such as attorney fees and lawn maintenance services, starting in 2007-08. These taxes could bring in a maximum of $900 million per year.