State lawmakers are discussing the controversial margins tax initiative. If passed, it would impose a 2% tax on businesses that make more than $1 million.
Opponents of the margins tax say it would hurt businesses and kill jobs while those in favor say it would generate $800-million for education.
The initiative is modeled after a similar tax, adopted in Texas -- the only other state. "It's been the experience in Texas that billions of dollars have been raised."
But some say the tax is bad for Nevada because certain businesses would pay, regardless of their profits.
"Businesses that are operating at a loss would have to pay the margins tax. I've talked to economic development folks in this state. They are scared that this is going to stop all of their efforts to bring businesses and industries into this state. It's going to be devastating for our economy," says Senator Michael Roberson (R).
"This tax hits the major goals of conservative tax of being broad-based, low rate, and reliable and dependable, year-after-year. So, it will be able to fund education and our future needs," says Dr. Richard Sims of the National Education Association.
If the legislature does not adopt the tax, it will still go on the 2014 General Election ballot.
But Republican leaders are pushing for an alternative measure - Senate Joint Resolution 15. It would remove a constitutional provision and allow lawmakers to change mining tax regulations.
"We want to kill the margins tax but we also want to fix this anomaly in the state where you have on industry that's treated differently than every other industry," says Roberson.
In 2011, Nevada mines produced almost $9-billion in gross revenue - $97-million was paid in taxes to the general fund in net proceeds.
Lawmakers say if mining companies paid the same rate as the gaming industry, it would add $780 million per biennium.
"We want to hear from the mining industry. We want to hear from the business community to try to craft tax mining policy that is appropriate for our state," says Senator Ben Kieckhefer (R).
But the creators of this initiative say it will actually stimulate the economy saying it would create 7,500 jobs within four years.
That resolution and the margins tax will likely compete against each other on the 2014 ballot. If they both pass, the one with the most votes wins.
Of course, voters can also shoot both of them down.
Sunday, May 19 2013 7:02 PM EDT2013-05-19 23:02:30 GMT
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