The activist group, the Progressive Leadership Alliance of Nevada (PLAN), has asked its board of directors to consider if a ballot question to amend Nevada's constitution to increase mining taxes is needed because of ominous signs that legislators will refrain from closing mining tax loopholes in any significant way...
State lawmakers are trying to find $1.1 billion in revenues to balance a $7 billion budget for the next two fiscal years. In 2007 Nevada set a record of $5.4 billion in commodities production. Because of a constitutional limit of 5% on mining taxation, the state earned $38 million in revenue and the counties $37 million.
After deductions, Nevada mining companies reported net proceeds of $1.5 billion in 2007.
In the letter, obtained by the Las Vegas Sun, Bob Fulkerson, state PLAN director, wrote, We could consider an amendment to strike the word ‘net' and change 5 percent to a higher number. Another, even simpler solution might be to just eliminate the mining tax section from the state constitution altogether.
Fulkerson noted that most of Nevada's voters live in the southern part of the state within the state's two largest cities, Las Vegas and Henderson. He suggested these voters could be convinced that mining companies, whose operations are mainly found in rural counties, are not paying their fair share.
A ballot question would have to pass in two elections to amend the state constitution.
However, the Nevada Mining Association says one industry should not be singled out for taxation. The industry also asserts that all the deductions should be allowed because the state constitution mandates a net proceeds tax, rather than a gross proceeds tax.
In a recent statement, Nevada Mining Association President Tim Crowley said, It's time to diversify our tax base, but we already pay a disproportionate share. We're willing to pay more as long as it's equitable.
The Nevada Legislature is considering an increase in the state's tax on payrolls for wages employers paid above $250,000. Crowley recently testified in favor of a bill to raise the modified business tax, which is a payroll tax.