Week in Review: 10 biggest problems with the margin tax
Every week, NPRI President Andy Matthews writes a column for NPRI's week-in-review email. If you are not getting our emails, which contain our latest commentaries and news stories, you can sign up here to receive them.
Early voting begins tomorrow, and the biggest decision voters will face is Question 3. Question 3 would impose a 2 percent margin tax on all businesses with revenue over $1 million a year. This includes businesses that are losing money.
Over the last three years, NPRI’s team has done a lot of research on the margin tax, highlighted the stories of individuals the tax would force out of business and even released a video earlier this week explaining how the tax would prevent a Nevada mother from providing for her family. Thank you for sharing that video, by the way; it’s already received over 5,000 views, and the numbers keep climbing.
I know the volume of NPRI’s research can be hard to digest for folks who are busy with work and family, so I wanted to boil it down into a quick top 10 list that you can share with your circles of influence so that they can be informed before they vote on Question 3. Source information for these facts is available at NPRI’s margin-tax resource page.
Here are the 10 most destructive things about Question 3:
10. The initiative is so poorly written that it could force competing businesses to file joint tax returns.
9. Gross receipt taxes, like the margin tax, “pyramid,” which favors larger, consolidated businesses over smaller ones.
8. Passing the margin tax would probably doom revenue-neutral tax reform efforts, like NPRI’s proposal to lower the sales tax rate while broadening what is taxed.
7. Because of the types of exemptions contained in the margin tax, some businesses, like family farmers, would be taxed at a higher rate than other businesses, like law firms.
6. The tax would reduce real disposable income by $240 million annually and
decrease investment by $7.1 million annually.
5. Passing this ballot question would further entrench the myth that Nevada hasn’t dramatically increased education spending over the last 50 years.
4. Question 3 would kill over 3,600 jobs, which would prevent dads and moms from providing for their families.
3. Because of how complicated the margin tax would be, mom-and-pop businesses would be hit with substantial compliance costs just to compute the tax.
2. Question 3 would hit businesses that are losing money with a new tax. This could force business owners, like Renee Newman, to shut their doors.
1. Pouring more money into Nevada’s broken education system would lead to a more expensive, but still broken, system that would fail tens of thousands of our children.
Remember, if Question 3 passes, the legislature can’t modify the language of the initiative for three years, so the stakes are even higher than normal.
Would you forward this email to 10 friends, family members or associates before they vote? You can help them make an informed decision.
Until next time,
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