Friday, March 14, 2003 | 4:56 a.m.
WEEKEND EDITION: March 16, 2003
Debate in Carson City over Gov. Kenny Guinn's plan for new and increased taxes heated up last week, the result of alternative proposals from legislators and a "line in the sand" declaration by Assembly Speaker Richard Perkins. The major proposal, which will be introduced Monday, came from Sens. Mark Amodei, R-Carson City, and Terry Care, D-Las Vegas. Their proposal swaps out the centerpiece of Guinn's plan, a gross receipts tax on big businesses, and replaces it with expanded sales taxes and increased room and gaming taxes. Their proposal is what led Perkins to declare that no tax bill would leave the Assembly unless a broad-based business tax was part of the mix.
We were relieved to hear Perkins take such a strong stand. From the start, our view has been that Guinn's proposal has a lot going for it. We share his view that the ultimate tax package should raise biennial collections by $1 billion. We also agree that it should zero in on previously under-tapped resources, such as the large retail chains whose current taxes in Nevada pale in comparison to what they pay in other states -- with no price breaks for consumers. In order to rope in the big chains, Guinn's proposal calls for a 0.25 percent tax on the gross receipts of annual business revenues above $450,000. Guinn has estimated that the tax, proposed to start in 2005, would raise $220 million a year, which would eliminate almost half of Nevada's current deficit. Under this proposal, the gross receipts tax the gaming industry pays would rise by the same 0.25 pe rcent, from 6.25 percent to 6.5 percent.
Guinn's whole proposal, which also includes new amusement taxes and increases in property taxes, so-called sin taxes and the per-employee business tax, achieves the critically needed increase in state funds and spreads it out evenly. The average taxpayer who is not represented in Carson City by a cadre of lobbyists does not pay a disproportionate share under Guinn's plan. We're leery of any proposal that seeks to let the big retail chains off the hook. The Care-Amodei proposal would do just that. While it would nick the gaming industry for an additional 0.25 percent of gross revenue, its expanded sales taxes and room taxes add to the burden of the average taxpayer.
As the proposals mount -- Senate Majority Leader Bill Raggio, for example, is planning to introduce a bill Monday that would shift a portion of property taxes from cities and counties to the state -- a fairness test must be applied. Those legislators not applying it may very well be asked just who it is they're representing.
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