Las Vegas Sun

March 28, 2024

carson city:

Lawmakers talk revenue: Business tax plan gets hearing

The first major piece of an expected tax plan received a hearing on Thursday, just days before a self-imposed deadline to pass a tax package.

The proposed amendment would increase the state's tax on payrolls for wages employers paid above $250,000, though the amount is still in flux.

It would drop the modified business tax all businesses paid on their first $250,000 of salaries.

As the Sun reported this morning, about three-quarters of businesses in Nevada have payrolls under $250,000 a year.

The meeting started with this: "I'm sure you're all thrilled to know the time has arrived," said Assemblywoman Kathy McClain, D-Las Vegas. "It's time to talk about revenue."

Then, a series of lobbyists representing businesses -- construction companies, gaming, homebuilders -- testified that they were at the table. They recognized that the modified business tax would have to be raised, but they wouldn't commit to a number.

Las Vegas Chamber of Commerce Chairman Steve Hill also said the business community understood revenues would have to be raised. But he pointed again to the list of reforms to government pay and benefits that his members wanted to see.

The modified business tax rate is currently 0.63 percent. It would drop to 0.5 percent for the first $250,000 per year that all companies paid. (Buckley had said last night it would be two-tiered for businesses, but the latest amendment showed that all businesses would pay the lower rate.) It is yet to be determined how much it would increase for following years.

A spreadsheet prepared by staff showed that increasing it to 1 percent would raise an additional $202 million for the next biennium; 1.25 percent would raise $349 million; and 2 percent would raise $788 million. It could be implemented by Oct. 1, according to the Department of Taxation.

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