CARSON CITY -- Gov. Kenny Guinn says he will propose some "interim" taxes in his plan to bail the state government out of a $704 million deficit.
The governor told reporters Wednesday his plan to the Legislature next Monday will have interim, intermediate and long range proposals.
Guinn needs to get immediate revenue this fiscal year to handle the deficit this year. And that will mean immediate tax increases, probably on liquor, cigarettes and possibly property tax.
Guinn has not disclosed what taxes he will recommend for an increase and for new revenues. But he has indicated there will be a business tax.
Marybel Batjer, chief of staff to Guinn, said today once the taxes are increased, they will not be repealed. But they could be reduced as other taxes come on line.
Batjer referred to the governor's task force that she said recommended an increase in the $100 a year per employee tax to be paid by companies. The task force suggested the tax be increased but she said it could be lowered when a business tax comes on line.
State officials say it will take 18 months to two years to implement a business tax.
The task force also recommended that the $100 per year per employee tax be raised to $140 to reflect inflation and that it cover all businesses including sole proprietors. And there be an annual $25 additional fee be imposed on each business for two years.
Batjer said as the potential business gross receipts tax takes effect, some of the other taxes to be raised might be reduced to their former level. But she refused to say if that was in the governor's tax plan.
The task force recommendation called for the 0.25 percent levy on businesses' gross receipts but those businesses that gross less than $350,000 a year would be exempt. They would continue to pay the $100 per employee tax.
The task force said that would exempt 60 percent of all Nevada businesses.
The task force said the expansion of Nevada sales tax should continue to be studied. It said it has "one of the most narrow bases in the country."
The Las Vegas Chamber of Commerce and other big business is advocating expanding the sales tax to services. But it is running into opposition from the gaming industry that favors the business tax.
Guinn said Wednesday he did not favor expanding the sales tax to services that would hit the general public immediately. As an example, he said he did not want to see the sales tax applied to a person getting a haircut.
But he said the sales tax could be expanded to some areas that would not immediately hit the consumer such as some financial transactions.
But he said the consumer eventually ends up paying the tax as companies pass along the increased fee.
archive