Nevada lawmakers continue debate over tax proposals

Nevada lawmakers resumed discussion Tuesday of Gov. Kenny Guinn's record $1 billion tax plan he says is needed to reduce a growing deficit and allow for some needed expansion in state services.

Mike Hillerby, Guinn's deputy chief of staff, briefly outlined for lawmakers key elements in the proposal, including increased taxes on businesses, cigarettes and alcohol, and a new entertainment admissions levy.

The Senate Taxation hearing on SB238 was shortened by discussion of another measure, and lawmakers held back questions.

Most of the panel has been reluctant to voice support or opposition to the entire tax package.

"This is still in its infancy," said Sen. Sandra Tiffany, R-Henderson. "It's going to be a bill to slog through."

After the hearing, Sen. Ann O'Connell held up three pages of handwritten questions for Guinn's budget staff. "I've got lots of questions," said O'Connell, R-Las Vegas. "This is definitely a moving target."

Lawmakers expressed eagerness to begin line-by-line discussion of the tax plan, as opposed to the overviews presented so far in the session.

"It's becoming old hat," said Assembly Taxation Chairman David Parks, D-Las Vegas, who sat in on the hearing.

Parks said his panel was likely to resume discussion of the governor's short-term tax plan later in the week. The long-term package includes most elements of that bill, which Guinn had hoped lawmakers would pass rapidly.

Also Tuesday, a long-term tax plan from the Governor's Task Force on Tax Policy was introduced in the Assembly.

The bill, AB281, differs slightly from the governor's proposal. Among other variations, it doubles cigarette taxes while the governor chose to triple them. Its amusement tax is 6.5 percent while the governor went with 7.25 percent.

The measure was sent to Assembly Taxation.

Any tax plan needs a two-thirds majority to pass both the Assembly and Senate. They must first win support from taxation panels on both sides.

Sen. Bob Coffin, D-Las Vegas, is the only Senate Taxation member to come out in full support of the governor's plan.

"I sit on Finance (committee), I know we need money," Coffin said. "I'm going to vote for a lot of taxes."

Both the long- and short-term tax plans would triple a $100 per employee annual business license tax. It would drop to $80 per employee once a proposed gross receipts tax takes effect in mid-2005.

Also, a 35-cent per pack cigarette tax would climb to $1.05. The governor also imposes an 89 percent increase in alcohol taxes.

The long-term plan includes a gross receipts tax on businesses with over $450,000 in yearly revenues, a property tax increase and other major changes.

The gross receipts tax -- which would be new to Nevada -- has generated the most opposition from business lobbyists and in public testimony on the bills.

Guinn's overall tax plan is designed to fill a budget hole that could be more than $700 million. In addition, the plan would allow for some program upgrades in the coming two fiscal years to meet demands caused by population growth.