Nevada voters to be asked to raise casino taxes
CARSON CITY – Nevada voters soon will be asked to sign on the line if they support the idea of a tax increase for the casino industry.
A group pushing for an increase in taxes paid to Nevada by the state’s biggest casinos plans to begin collecting signatures from registered voters later this month.
The state teachers union, pushing for its own proposal for a tax on business profits, will not seek signatures until later in the year.
The two proposals, both initiative petitions to change existing state law, will be presented to registered voters this year as the question of Nevada’s tax policy takes center stage for Gov. Kenny Guinn, the Legislature, the business community and the public.
Sen. Joe Neal, D-North Las Vegas, is the primary force behind a proposal to raise casino taxes. Neal was unsuccessful last year in getting the Legislature to support his proposal to increase the tax to 8.25 percent on the largest casinos.
His petition proposes to create a tax rate of 11.25 percent for casinos that earn $1 million or more a month in gross revenues. The proposal would affect an estimated 107 casinos, which now pay a 6.25 percent gambling tax.
Neal estimates his plan would raise $388 million a year. He proposes to direct 45 percent of the new tax money to public education, 38 percent to reducing the motor vehicle privilege tax, 8 percent to raise Nevada Highway Patrol salaries, 7 percent to economic diversification efforts and 2 percent to fight gambling addiction.
Ken Lange, executive director of the Nevada State Education Association, said the teachers union will probably start collecting signatures for its business profits tax plan in late spring.
The 22,000-member teachers union announced its intentions before the end of the 1999 Legislature. Union officials said a new tax is needed to address the issue of a structural deficit in Nevada, where growth in basic programs will continue to exceed existing tax revenue.
The proposal would create a new tax of 5 percent on net business profits, with some exceptions likely for mining and casinos. The first $25,000 in profits earned by any business would be exempt, making the impact on rural counties negligible, Lange said. The tax would raise an estimated $250 million a year and would be directed to public education.
Groups seeking to propose a new state law or amend existing state law have until Nov. 14 to obtain the 44,009 signatures of registered Nevada voters needed to qualify their proposals.
If the number of signatures is found to be valid, the proposals will go to the 2001 Legislature for consideration. The Legislature has 40 days to enact the proposals. If lawmakers choose not to enact the proposals, they will be placed on the 2002 general election ballot.
Guinn is also taking a serious look at Nevada’s tax structure as part of an overall review of state government operations.
But Guinn has spoken out in opposition to both tax proposals, saying the revenue issue needs to be addressed by his administration and the Legislature.