The head of the Nevada Mining Association said he’d rather see the industry pay more in fees, pre-pay its taxes — or a combination of both — rather than lose deductions it enjoys under state law. Tim Crowley said today the mining industry wasn’t happy with an idea to remove deductions that allow the industry to write off many expenses related to digging up, processing and selling precious metals, but was willing to come forward with other money to help the state fix its budget problems.
“We are working to participate in a way that’s meaningful,” Crowley said today. He said the gambling industry and the mining industry are willing to pay more in fees to cover the budget deficit, but that other businesses should participate, too.
“We’re hoping that all other businesses are taking the states steps that gaming and mining are doing,” he said.
Alas, they’re not: Gov. Jim Gibbons, as well as Assembly Speaker Barbara Buckley and state Senate Majority Leader Steven Horsford (both Democrats) have all said that tax increases on businesses are off the table for the special session that will start Feb. 23. But with even anti-tax Gibbons embracing the idea of removing some mining industry tax deductions, the industry is increasingly under pressure. (Gibbons spokesman, Daniel Burns, said eliminating deductions isn’t a violation of the governor’s legendary anti-tax pledge, since the rate of taxation will remain unchanged. Eliminating a deduction on an existing tax is not creating or raising that tax, Burns explained.)
Crowley did suggest a somewhat elegant alternative that would be both broad-based and comport with Gibbons’s philosophical framework, however. In Nevada, all property gets a 65 percent exemption, such that homes, businesses and other property is only taxed at 35 percent of its appraised value. If the state were to adjust that 65 percent exemption, say down to 50 percent, it would gain more revenue, although the rate of taxation would remain the same. And, under Gibbons’s rule, it wouldn’t be a tax increase, even if people and businesses were paying more actual cash. (Crowley further suggested the repeal could apply only to businesses.)
What are the chances of it being tried? Probably zero. But it’s a snazzy idea nonetheless, one that supporters of eliminating the mining industry’s deductions will have a hard time countering without looking at least a little hypocritical.
Tags: Jim Gibbons, Nevada Legislature
Loading ...
Gibbons’ Inadvertent Brilliance
The “close the loopholes on mining” may be seen as too little for such a large extraction…but does open the door to this thought: Let’s close all the tax loopholes for the next three years. The loophole is the outcome of special interest politics is it not? It is the ability of the have’s to manipulate the system at the expense of the have-nots. So let’s level the playing field. Close all loopholes — including redevelopment districts, as long as it doesn’t impact bond repayments — for three years. get that money back into state and local coffers..And we can say, like Gibbons, it’s not a tax increase just a reduction of tax breaks — the tax breaks that special interest politics have used to help get us into this situation (we can all play the blame game, can’t we?). It will hit all segments across the board, would it not, and capture the “why we’re angry at government” gestalt?
Just a thought