Guinn’s tax plan in hands of lawmakers

Erin Neff

Thursday, March 6, 2003 | 11:30 a.m.

CARSON CITY -- Gov. Kenny Guinn dropped his $1 billion tax proposal into the hands of the Legislature on Wednesday, absolving himself of the state's budget crisis and urging lawmakers to either approve his plan or come up with their own.

"It's not a fun and games program, it's not even political," Guinn said. "It's governance that Nevada needs now. I think I'm absolved from a governance standpoint."

The tax plan, which is embodied in Assembly Bill 243 and Senate Bill 232, would raise $984 million in new taxes in the next two fiscal years and would establish a gross receipts tax on business to take effect in 2006.

The plan raises taxes on cigarettes, liquor, property, gaming, slot route operators and business licenses and creates two new taxes. The gross receipts would be one quarter of 1 percent on all business receipts over $450,000. An admissions and amusement tax would be 7.3 percent on all admissions except participatory sports and movie rentals.

"What we're trying to focus on here is big business and gaming," Guinn said during a press conference prior to the introduction of his bills in both houses.

The bills are 182 pages long and weigh about 2.5 pounds apiece when printed on regular-sized paper.

Guinn said if the lawmakers do not approve some plan to bring Nevada the same amount of new revenue, or a plan to cut that much out of the budget, there would be dire results.

He also urged lawmakers to support his call for emergency tax increases of $77 million, to take effect April 1. He warned that the Legislature should not simply draw down the $136 million rainy day fund to balance the fiscal year's budget.

If the United States goes to war with Iraq, Guinn said Nevada revenues would take "a steep dive."

He also said that if the rainy day fund is wiped out and the state hits another economic crisis, he would be forced to make severe cuts.

"It will be thousands (of layoffs) because how much can you cut from the budget with personnel," Guinn said. "If you lay people off, there's accrued vacation and sick leave to pay."

"If that's the risk they want to take, they can," Guinn said.

Guinn's deputy chief of staff Michael Hillerby said he hopes the state does not need Guinn's emergency taxes.

"It's almost an insurance program," Hillerby said.

Testimony continues this afternoon in both the Assembly and Senate Taxation committees on Guinn's emergency tax proposal.