Teachers prepare to file for business tax
The Nevada State Education Association will file its business tax initiative March 21 asking voters to back a net profits tax on all but the smallest Nevada businesses.
But Debbie Cahill of the teachers association said it won’t put small companies out of business or drive away those thinking about moving to the Silver State.
“We have a study showing the impact to a firm in Nevada making $50,000 would be about $7 a year,” she said.
She said the association has talked about a 5 percent tax on net profits as reported to the Internal Revenue Service, but that the final tax requested by the initiative petition now being drafted may be as low as 3 percent.
She said that would raise up to $200 million a year for education in the state.
“I’m getting tired of people saying they’re opposed to it when they don’t even know what it is yet,” she said. “I’m disappointed at the people taking the attitude that, ‘We haven’t seen it, but we’re not paying any more taxes, ever,'” she said.
Cahill said the tax would be broader based than a gaming tax increase, which would rely on the health of one industry. She said, however, gaming would pay about a quarter of the proposed business tax.
She said those businesses making less than $30,000 a year net profit would be exempt.
And she said it would require little bureaucracy to administer because it would be assessed based on each company’s federal tax return.
While Larry Osborne of the Carson Chamber of Commerce came out against the tax plan last week, saying even the rumor was keeping new businesses from moving here, Cahill said she doesn’t buy that.
And Dave Howard, who represents the Greater Reno-Sparks Chamber of Commerce, said that group would reserve comment until seeing exactly what the teachers propose.
“It doesn’t serve anybody to say it’s going to ruin everything,” he said. “Let’s see it and then we’ll talk about it.”
While reserving comment on the initiative teachers are preparing, Howard said the Reno chamber does oppose the idea of imposing a tax by initiative petition.
“If we’re going to do anything to the tax structure of the state, it needs to be done by the Legislature and not by initiative,” he said.
He said California has done that and “actually ruined some counties.”
“I don’t want to see that happen to Nevada,” he said.
Howard said the Reno chamber has seen Sen. Joe Neal’s proposed initiative, which would effectively double taxes on Nevada’s largest casinos, and opposes it.
Nevada Resort Association Executive Director Bill Bible pointed out that both the existing and Neal’s proposed gaming tax are also gross revenue taxes, which means the percentage is applied before any deductions instead of after, as with the federal income tax.
Bible said the resort association, which represents most of the state’s largest casino operators, won’t have any comment on the teachers’ initiative proposal until members see it.
“The devil’s in the details and we really can’t comment until we read the actual initiative petition,” he said.
Bible added that casino operators don’t know whether the teachers’ plan would let gaming businesses deduct their existing taxes from the levy proposed by teachers.
Neal said he believes casino operators can and should pay more. He said they are taxed at a much lower rate than legal gambling operations in other states and countries. And he said polls show that, if taxes must be raised, the public favors hitting the casinos.
Neal said hitting all other businesses with a new tax won’t be popular with the rest of the state’s residents and is just an attempt by teachers to reduce gaming’s opposition to their proposal.
“Teachers are going to have to wake up and stop trying to play their game with the gamblers,” said Neal, D-North Las Vegas.