Study touts Nevada business climate as ads begin in Calif.

Kevin Rademacher

Thursday, Oct. 14, 2004 | 11:12 a.m.

On the same day that Nevada economic development officials unveiled a new advertising campaign in California, a Washington-based organization released a study hailing this state's tax climate.

The Tax Foundation study said that Nevada has the sixth-best business tax climate in the United States, behind only South Dakota, Florida, Alaska, Texas and New Hampshire.

"State's do not enact tax changes in a vacuum," said Scott Hodge, president of the Tax Foundation. "Every tax change will affect a state's competitive position relative to its neighbors, as well as globally."

Bill Ahern, a spokesman for the foundation, said Nevada had relatively high sales taxes, but that was merely a compensation for the lack of personal income taxes and corporate income taxes.

California ranked No. 38 on the list, a point officials from Nevada were hoping to highlight in a new advertising that pokes fun at Gov. Arnold Schwarzenegger's movie star background.

The $650,000 campaign asks: "Will Your Business Be Terminated?" The jab at the governor's "Terminator" character points to California's high workers' compensation insurance costs, high utility bills and expanded family medical leave laws.

The campaign touts "Nevada to the rescue."

Figures compiled by the Commission on Economic Development showed 3,315 new jobs from 79 new businesses in Nevada during fiscal year 2004, the vast majority of those businesses coming from California. Commission records also said that 660 jobs had been created through the expansion of 12 Nevada companies.

The new Nevada campaign comes after an August publicity stunt in Las Vegas when Schwarzenegger -- amid theatrical smoke and pounding rock music -- came to the Fashion Show mall to unveil a billboard campaign designed to lure businesses back to California.

At that event, Schwarzenegger said he was leading an effort to improve California's business climate.

Several business owners that have already left California for Nevada hailed Schwarzenegger's efforts but said improving that state's climate is a daunting task.

"There's nothing that he has done that would have stopped me from moving," Mitchell Grief said in August. He moved his plastic bag manufacturing business, Coast Converters, and 125 employees from Southern California to North Las Vegas last year.