Click here to hear Danny Thompson’s conversation with KXNT’s Samantha Stone (3 minutes).
The business profits tax measure that was promoted unsuccessfully last year by Nevada’s legislative Democrats will soon circulate as a voter initiative. The details are still being scrutinized by attorneys, but the measure is based on the Texas margins tax, and would be applied to all Nevada businesses.
In the version considered by the legislature, the first million dollars of revenue would have been exempt from taxation. Business would be allowed to deduct either its labor costs or cost of goods sold, with the adjusted amount to be taxed. The margin tax is conceived as a way to broaden the tax base, but opponents liken it to a corporate income tax, and point to Texas, where the application has been problematic, and the tax is roundly disliked.
KXNT spoke recently with Nevada’s AFL-CIO lobbyist, Danny Thompson, who made a public vow to legislators in 2011 that if they did not pass the margin tax, he would work to place it on the ballot. Thompson previewed the initiative this weekend, and is hopeful it will be released later in the week, with signature gathering to start immediately.
If it qualifies with enough signatures by November, the measure will go to the legislature for action in 2013. Legislators may pass it, or take no action, in which case it would go on the ballot the next year.