Kelly Bullis

Back to: News
July 7, 2012
Follow News

Union's tax initiative is bad for Nevada

There's something fishy about a petition being circulated around at various locations this summer trying to get enough signatures to be placed on the ballot.

The first thing that caught my attention was the attempt to deceive honest folks to get them to sign the petition. The AFL-CIO and teachers' unions have named it the Education Initiative. To me, that would mean that it has something to do with education. I'm a simple-minded man. And the group is betting that you all, like me, come to the same incorrect conclusion.

Reality is that this petition has nothing to do with education. Instead, it is a new tax on businesses for mostly General Fund use.

Does that bother you? It bothers me, a lot.

This tactic does not belong in Nevada. Maybe Chicago, where unions and organized crime seem to be widely accepted, but in Nevada, honesty in naming a petition to match its general intended purpose should be the given.

The more I dug into this petition, the more I came quickly to understand that this would create a gross margin tax on businesses. (A clever way of creating a new level of sales tax on the general public, only expanding it to otherwise exempt businesses under our current sales tax system. Food? Medical services? Etc.) You make a business pay a tax, and they will pass it along to consumers in the form of a higher price. So who is the target of this tax?

There is a bone thrown to supposedly "protect small businesses," by limiting the tax to businesses with gross margins of more than $1 million. What is missed in the details of this is the types of businesses that are "small businesses" with gross receipts of more than $1 million a year and barely any profit left over. Gas stations? Franchise operators? Restaurants? Medical clinics? Ranches? Farms? Need I go on?

This petition also seeks to beef up the Nevada Department of Taxation to the nightmare levels of intrusion that we see in California's Franchise Tax Board. Anybody from California thinking you had escaped the Franchise Tax Board making your lives miserable want to see that happen in Nevada?

Finally, creating such a tax at a critical time when we are desperately trying to attract businesses to Nevada would pretty much kill those efforts. Those companies would just bypass Nevada for more tax-friendly states like Idaho or Wyoming. Companies now in Nevada would begin to consider moving out. Isn't our unemployment rate high enough? Do we really want to drive it higher?

These are just some of my thoughts. Please be careful about signing this petition when somebody walks up to you. It's important that you know the facts.

• Kelly Bullis is a Certified Public Accountant in Carson City. Contact him at 882-4459.

Stories you may be interested in

The Nevada Appeal Updated Jul 7, 2012 03:50AM Published Jul 7, 2012 03:49AM Copyright 2012 The Nevada Appeal. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.