Sandoval: Democrats’ tax plan would ‘bring job growth to a halt’

By David McGrath Schwartz

Thursday, May 5, 2011 | 4:10 p.m.

CARSON CITY — No surprise here: Democratic leadership in the state capital didn’t have any luck today winning Gov. Brian Sandoval over on their plan to increase state revenue. Sandoval said the plan to raise taxes would “bring job growth to a halt.”

“We had a frank discussion about our differences of opinion concerning the impact of raising taxes, and I restated my belief that raising taxes in this economy would be a mistake,” Sandoval said in a statement after meeting this morning with key Democrats.

Sandoval campaigned on a promise not to raise taxes, and has remained consistent. His budget does use a number of diversions and other one-time uses of money to raise more than $615 million. Democrats said some of that is bad policy, and would use some of the taxes they increase to offset his proposals.

Senate Majority Leader Steven Horsford, D-North Las Vegas, and Assembly Speaker John Oceguera, D-Las Vegas, also presented their plan to raise funding by $1.5 billion compared with what Sandoval submitted in January to the Republican leadership. Republicans in both the Senate and the Assembly released statements expressing opposition to the Democrats' plan.

Horsford and Oceguera said $600 million in revenue would be generated by delaying the expiration of taxes approved two years ago, $600 million would come from a new sales tax on services and “margin tax” and $300 million would come from additional revenue, including about $267 million that the Economic Form projected on Monday as new revenue for the state.

Taxes have to win two-thirds majority approval in the Assembly and Senate, which means Democrats in both houses would need to win Republicans over to their side. Republicans in the Assembly have offered to negotiate the taxes passed in 2009 that are set to expire in June, but only for reforms that Democrats have been unwilling to support.

Senate Republicans have offered no public negotiating room, pledging their support for Sandoval, whose budget position grew in popularity within his party’s ranks after Monday’s brighter Economic Forum revenue projections.