Proposed Nevada business profits tax to support public education expected to be filed

CARSON CITY – A proposal seeking to implement a business profits tax in Nevada to support public education will be filed with the Secretary of State’s office on Wednesday.
Supported by the state teachers union and the AFL-CIO, if the groups can collect 72,352 signatures by November 13, the issue of taxes will be dumped squarely in the laps of state lawmakers in 2013.

News that the groups were finally ready to file the initiative petition was first tweeted by Las Vegas Sun columnist Jon Ralston.
The proposal would levy a 2 percent tax in excess of $1 million on Nevada business profits. The money would all go to public education. If the new tax becomes law, supporters indicated they will work towards repeal of the state’s current payroll tax, called the Modified Business Tax.
If enough signatures are collected from Nevada registered voters by the deadline, the 2013 Legislature would have 40 days to approve the proposal or it would go to the voters in 2014. Lawmakers could also offer a competing tax proposal to appear on the ballot, but a two-thirds vote would be required to move any competing tax measure forward in the Legislature.
Gov. Brian Sandoval today reiterated his opposition to such a tax proposal. Sandoval earlier this year said he will extend a collection of taxes set to expire on June 30, 2013, into the new budget to ensure there are no further cuts to education.
Supporters of the profits tax say that move doesn’t go far enough, however.
The proposal has evolved since first being discussed by Danny Thompson, executive secretary-treasurer of the Nevada State AFL-CIO, in November 2011. Initially the proposal was going to raise money for public and higher education, but that was changed to K-12 education only.
The tax was also proposed initially to be assessed on profits in excess of $500,000. That threshold is now $1 million.