Tax amnesty program generates cash for Silver State
August 19, 2008
Halfway through the tax amnesty program ordered by Gov. Jim Gibbons and the Legislature this summer, the Department of Taxation has collected $6.6 million ” including more than a third of a million dollars from a tax that no longer exists.
The amnesty allows businesses that owe the state money the chance to avoid penalties and interest if they voluntarily sign up with the Department of Taxation and pay the back taxes. It began July 1 and runs through Sept. 30.
Gibbons spokesman Ben Kieckhefer said the total generated by the amnesty could be as much as double the $6.6 million.
That prediction is backed up by Taxation Director Dino Dicianno who said that in past tax amnesties, most of the revenue comes in during the final few weeks of the amnesty period.
“Delinquent taxpayers will hold on to their money as long as they can,” he said.
Most of the money, $3.44 million, is collections owed under the Modified Business Tax. That’s no surprise since it is the newest state tax and Taxation is still trying to find all the businesses which must pay it.
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Most of the rest is Sales and Use Tax collections at $2.6 million. And $119,394 was collected in back business license fees.
But the surprise was the $367,725 collected under the old Business Activity Tax, which was repealed in 2003 and replaced with the new tax.
“There’s no way we were going to get that money any other way,” said Kieckhefer.
Dicianno said the other advantage of the amnesty program is that a total of 3,165 payments have been received from businesses, and those businesses are now listed on the department’s tax rolls. That means they’ll have to pay their taxes from now on just like every other business in Nevada.
Of the $6.6 million collected, nearly $4.6 million goes to the state treasury. The rest is the share of those taxes which goes to local governments and school districts throughout Nevada.
Gibbons, in a prepared statement, said the money doesn’t solve the state’s fiscal problems but that every new dollar helps.
“We’ve already seen some revenues come in lower than the Economic Forum projected at the end of June, so any additional revenue we collect through the amnesty program will help balance the budget for the remainder of the fiscal year,” he said.
– Contact reporter Geoff Dornan at firstname.lastname@example.org or 687-8750.
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