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February 20, 2013 / jimnv

Let’s Talk Tax Reform and Mean It

The state’s finances are a mess after decades of  inaction. The tax system does not work well, and most legislators know it. Incredibly many still refuse to seriously talk about it. Partisan politics are divisive and when one adds casinos and mines to the mix, any meaningful negotiations are a dream. Nevadans need a well thought out tax code that properly funds state government and education over the long-term.

Despite the doom and gloom, I read that some legislators were seriously talking about comprehensive tax reform and doing something it in this session. This was astounding news to me.  Apparently, Democrats who control the assembly and senate have decided to work together for “meaningful reform”. Their goal is to provide a reformed taxing plan that would create stable revenue in the long-term.  The names that come up are, Mo Denis, Senate Majority leader and Assembly Speaker Marilyn Kirkpatrick. They acknowledge it will not be easy in a state where even acknowledging what they are doing is a difficult .

Unsurprisingly, Republicans are not described as being cooperative or willing to honestly negotiate in this effort. Their only answers are slogans such as the need for “smaller government” and “no new taxes”. They will not say how to reform anything or explain how they would properly fund state government. It’s sloganeering over substance. Further, Governor Sandoval says he is willing to look at any proposal but he will stick to partisan principles to guide his decision to veto them. So much for meaningful discussion.

Still, there is talking.

I would like to believe all this is being done because it is the right thing to do. In reality, the teacher’s margins tax initiative petition is driving this effort. The Nevada State Education Association and unions back the margins tax initiative as a way to create a stable source of  income for education. The initiative would create a corporate income tax to help fund our educational system.  Surprisingly, despite legal attacks, the tax initiative lives. In late January, the Nevada Supreme court decided the petition was valid. (Click here to read the decision.) This means the legislature must vote on it within the first 40 days of the session or it will be placed on the ballot for a vote in 2014.

As usual, all this is complicated and extremely partisan. Talking about reform and then doing something about it would be a big deal in Nevada. Nevada’s tax system is  dysfunctional, and like Frankenstein’s monster, it is cobbled together with bits and pieces of money from various sources. The resulting budget is scary and sometimes bites back.

As for tax reforms…. keep talking.  Never mind the whiners and snivelers.

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