Topic: Tax Increases In Nevada Like Never Before (Read 272 times)

Nevada Passes Largest Tax Hike in State History

The Nevada legislature approved the state's largest-ever tax hike that will raise up to $1.1 billion in new and extended taxes to initiate far-reaching reforms in Nevada's struggling K-12 education system.

In a 30 to 10 vote Sunday, the Assembly approved all three major facets of Republican Gov. Brian Sandoval's tax plan, including his "Nevada Revenue Plan," which is a hefty hike on cigarette taxes and the continuation of a group of formerly temporary business taxes called the "sunsets."

On Monday, the Nevada Senate passed the tax increase 18 to 3, ensuring the bill would now go to Sandoval for signature.

Sandoval, Nevada's popular Republican governor elected by a large margin to a second term in November, made the tax increase the centerpiece of his legislative agenda this year. The state has struggled to fund education for decades. Democrats, who had held the majority in the Legislature for two sessions before Republicans took both houses this year, had tried and failed to pass a new business tax in 2011 and 2013.

In an effort to win support from more conservative Republicans, Sandoval linked his call for a tax increase to sweeping education reforms, including what has been described as the most robust parents' choice measure—which funnels money to families with children in private school—in the country.

Passage of the bill required a two-thirds majority in the Assembly, which was easily achieved after Sandoval's staff put on a "full-court-press" lobbying effort over the past few days that drew the ire of anti-tax conservative leader Assemblyman Ira Hansen, R-Sparks.

http://www.usatoday.com/story/news/2015/06/01/nevada-tax-hike-sandoval-education/28309841/

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Elements of the plan include:

- A hike in the business license fee. The fee for corporations would rise from the existing $200 a year to $500, while the fee for the rest of the business entities would remain at $200.

- A hike in the payroll tax. Sandoval's plan raises the state's existing modified business tax from 1.17 percent to 1.475 percent of wages beyond the first $200,000 a company pays out each year and sets the rate at 2 percent of those wages for the mining industry and financial institutions. Companies would still get to deduct health care premiums for employees from the calculation.

- A "Commerce Tax" on gross revenue. Industry-specific tax rates will apply to businesses with more than $4 million in Nevada revenue each year. Businesses can count 50 percent of their commerce tax bill as a credit against their modified business tax bill — a provision that's intended as a perk to those who employ people. The commerce tax aims to capture more money from capital-intensive businesses such as mines and those that do business in Nevada but aren't based here.

- A flexible payroll tax rate. The plan allows the state to lower the modified business tax rate if revenues from the new commerce tax and MBT rate bring in more revenue than projected.

- An extension of "sunset taxes." More than $500 million of the plan comes from making a set of expiring payroll and sales taxes permanent.

- Cigarette taxes. The bill raises a tax on cigarette packs by $1, which is expected to generate about $100 million over two years.

More...[url][http://www.newsmax.com/US/US-Sandoval-Tax-Plan/2015/06/01/id/648093//url]