Tuesday, April 23, 2013

Finally, Status Quo May Be No More.

This week looks to be another hectic one in Carson City. History is already being made everywhere we look in the Nevada Legislature. So it's understandable that some matters are being overlooked during such a busy time.

However, this is also important. After all, we're about to talk about the state's budget. And we're about to talk about "The T Word".

Back in February, we heard plenty of banter on "revenue-neutral reform". But today, that doesn't look to be going anywhere. Why not? Basically, people just didn't like it.

But with just 41 days left, Speaker Marilyn Kirkpatrick, D-North Las Vegas, said any effort to pass a services tax is dead and sounded less than optimistic about the chances of any kind of broad-based business tax making it to a vote.

Kirkpatrick blamed a flurry of press reports on the services tax for its demise.

“You killed it,” Kirkpatrick told a Sun reporter last week. “You got all the Democrats against me on it before I even had a chance to explore it, so I didn’t even explore it.”

The idea of expanding Nevada’s sales tax to services such as legal advice, accounting and hair dressers was originally introduced in Nevada by a Democrat last session. But in the past two years, Republicans around the country have launched an effort to move away from income taxes and toward consumption taxes such as a services tax.

Actually, Speaker Kirkpatrick, the media themselves didn't kill it. Lack of public support killed it. And perhaps the fact that it was just plain bad policy had a hand in killing it as well.

And then, there's this. Last month, Senate Minority Leader Michael Roberson (R-Henderson) leaped ahead of Kirkpatrick, and even seemed to lurch to the left of her at first (??!!), with his wild & crazy IP 1 alternative mining tax proposal. In the wake of that, whatever momentum was left for "revenue-neutral" sales tax extension dissipated quite quickly. Of course, it didn't take long for this to run into serious legal & political roadblocks. Yet despite that, Roberson at least succeeded in completely reshaping the contours of the Nevada Legislature's tax debate.

And that, in turn, revived political fortunes for SJR 15 and mining tax reform. In February, SJR 15 looked to be near death. But now, there's tremendous pressure for the Assembly to act soon following the Senate's resounding 17-4 passage of the bill to take the mining industry's tax policy bailouts out of the Nevada Constitution.

And then, there's The Education Initiative. Funny enough, Roberson constructed his mining tax alternative for the expressed purpose of defeating the actual IP 1. But instead, his and other Republicans' case for restoring social safety net funding can now benefit The Education Initiative since it's the one tax reform initiative left standing. Who could have guessed defeat would soon open the path to victory?

It's been a wild and crazy ride so far for tax reform during the 77th session of the Nevada Legislature. And it still has another six weeks to go. Perhaps there may be more surprises. Or perhaps the Legislature will settle for the status quo again. Yet even if the latter occurs, it may ultimately be temporary. Whatever comes out of the Legislature by June, we'll finally have the chance to vote on real reform next year. And that's real progress.

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