For some time now, Nevadans For Fair Gaming has been working on a petition effort to see taxes increase to bring more money to the education sector. A petition drive must be completed with adequate signatures before the idea will even be considered. Of course, the gaming industry does not approve of a tax increase and wants to see a judge stop the petition drive. The Nevada Resort Association recently filed a lawsuit against the initiative in an effort to see it halted.
Stop Tax Increase
The Nevada Resort Association represents over 70 hotel/casino properties in the state and their political arm is the one taking action against the Nevadans For Fair Gaming Taxes group. They want to see the petition nullified and no longer a threat to their industry.
The coalition of teachers from the Las Vegas area want to see the state’s constitution amended so that they can raise more taxes for education. The goal is to se as much as $315 million a year from the bigger casinos.
According to those opposed, the tax increase would be as high as 44% for certain operators. The Nevada Resort Association’s political arm is arguing that the description of the petition is misleading and the effective date for the initiative is against the constitution.
The 200 word description of the initiative does not reference how the new revenues will be spent from the general fund. The Clark County Education Association is supportive of the effort, stating that the increase would provide hundreds of millions of dollars for the education industry.
Details of the Proposal
The proposal for the casino ballot initiative would add a fourth tier to the casino tax program as it stands currently. Operators who earn over $250,000 in monthly gross revenues will pay 9.75% in taxes. Right now, the system has a top tax amount of 6.75% on amounts earned of more than $134,000. The taxes set for smaller venues will not change based on the new initiative.
The petition would also see the local School Support Tax increase to 4.1% from 1.5%. This change is also being challenged via lawsuit but this time by the Vegas Chamber. If this change comes to fruition as well as the higher tax rate for bigger casino revenue earners, the total amount of sales tax in the state would increase close to 10%.
Those opposed have questioned the time frame in which the increased tax rates will go into effect. A challenge has been initiated regarding the date in the petition of January 2023. Reportedly, it would be impossible to start on this date as a minimum of 38 days are required for the review of the plan as well as to get the go-ahead from the Supreme Court once voters approve the measures due to the taxes being collected on a monthly basis.
We shall see in the coming weeks what becomes of the lawsuit and if a judge will rule in favor of those opposed to the change or those in favor.
