Dear Nevada State Legislator:
On behalf of the members of National Taxpayers Union (NTU) in Nevada and across the country, I urge you to oppose bills in the current legislative session that would impose higher taxes on individuals, families, and businesses. While a weak economy has in recent years contributed to lower revenue collections for Carson City, adding to the tax burden would only exacerbate the state’s financial woes by further straining family budgets, inhibiting growth, and encouraging job creators to relocate.
NTU is particularly concerned about the adverse impact of the following legislative proposals:
- SB252: Governor Brian Sandoval’s “business license fee,” which would raise taxes by an estimated $437 million over the next two years. This proposal is essentially a gross receipts tax – a form of taxation that is particularly harmful to private-sector growth, according to economists. The Tax Foundation’s research shows that this scheme would create astronomical effective marginal tax rates for some businesses that could reach 13 million percent.
- SB 483: This legislation would make permanent a number of expiring tax increases including higher rates on payroll and sales taxes. It also imposes a 50 percent increase in the cigarette excise tax. In total, it would raise taxes by approximately $545 million over a two-year period, which would hurt economic growth and further burden Nevada’s families at a time when they face an uncertain financial future.
- SB 455: This bill would raise the state excise tax on cigarettes to $1.20 per pack, which would constitute a 50 percent increase over the current rate. This would be a regressive tax hike, as research shows that the burden of tobacco taxes is disproportionately borne by lower-income taxpayers. Further, a recent study by NTU Foundation examining a decade of data demonstrated that in nearly 70 percent of cases, tobacco tax increases failed to meet revenue projections; moreover, almost 70 percent of them were followed by additional tax hikes.
- SB382 and AB380: These bills would expand Nevada’s sales tax collection authority beyond what is permissible under the U.S. Constitution’s Commerce Clause. By stretching the definition of “physical nexus” well past reasonable interpretation, SB382 and AB380 would further complicate interstate sales tax collection rules and increase the tax burden on Nevada consumers.
Again, NTU urges all legislators to oppose these and other misguided attempts to balance the budget through tax increases. Responsible budgeting requires making tough choices, such as prioritizing spending and reducing wasteful outlays. Tax hikes might provide a short-term infusion of revenue, but in the long run would undermine the state’s fragile recovery. Thank you for considering the views of taxpayers.
Executive Vice President