Nevada spending tax money to convince you to pay more taxes
Consider this your warning on what the political playbook in Nevada is going to look like for the next two years. Nevada legislators take your money and spend it to convince you that they need even more of your money.
Ironically, the Nevada Development Authority is currently running a million dollar ad campaign urging California businesses to move to Nevada because of our low taxes. Maybe they should run a few ads before the Interim Finance Committee.
Lawmakers have issued a request for a consultant who will analyze the state’s tax structure, measure the public’s willingness to accept a broader tax base and examine the balance between local and state revenue…
Horsford tried unsuccessfully last session to push for some kind of corporate income tax. He won’t commit to supporting any one idea at this point, but he said the need to change the tax system is evident.
“We absolutely have to fundamentally change our revenue structure to have one that works, in good economic times and bad economic times,” Horsford said…
Though legislators did not mention a dollar figure, earlier estimates were that $500,000 should be set aside for the study.
The thing that drives me the craziest about all this is Sen. Horsford’s assertion that we need a revenue structure that works in good and bad times. Look at California. According the Tax Foundation, the Golden State has the fourth-highest individual income tax rate in the country, the highest corporate income tax rate in the West, the highest sales tax rate in the nation, and, despite Prop 13, only slightly below-average property tax collections.
Despite all those taxes, California had to issue IOUs this summer, because it ran out of money.
The economy moves in cycles and hence, the amount of taxes paid to the government fluctuates – no matter how many taxes you have. When the government increases spending at a rate that exceeds population growth and inflation and projects to keep growing at that unsustainable rate, it sets itself up for these false “crisis” moments when the economy slows down. To read about this process in detail, read “The one-way bet: State budgeting process: Heads they win, tails you lose.” Or just look at this chart from the article, which explains it all.
Side note: Gov. Gibbons vetoed the $500,000 in funding for the tax study, but Sen. Raggio and the other members of the Interim Finance Committee are going to use contingency funds to pay for it. Just something to remember the next time Nevada’s leftists (of both parties) start complaining about how they need more money and they’ve cut to the bone.