Assembly Republicans decry impact of tax hikes

Republican Assemblymen who voted no, say the tax increases approved Friday to balance the budget will devastate Nevada's economy.

"This billion dollar tax increase will have a devastating effect on our tourism industry, will discourage job growth with a payroll tax and will pile an enormous burden on the families of Nevada who are already hurting," said Ty Cobb of Reno.

"My constituents don't want expanded social programs and handouts," said Ed Goedhart of Amargosa Valley. "They want jobs and this tax hike kills jobs."

The compromise bill was developed by a bipartisan group of Senators and Assembly members to fund the $6.75 billion General Fund budget developed over the course of this legislative session.

"On the same day on which it was announced that the unemployment rate in Nevada increased even further into the double digits, the response of the Democrats in the Nevada Legislature was the increase the size of government with the largest tax increase in Nevada state history," the letter states.

The primary generators in the tax package are a 0.35 percent increase in the sales tax and the near doubling of the Modified Business Tax to 1.17 percent of total payroll. The package is projected to raise about $781 million over the biennium.

That would be a slightly smaller increase than the $833 million tax package approved by the 2003 Legislature.

In addition, however, there are a variety of other increases and revenue generators, which were recommended by Gov. Jim Gibbons. The largest piece of that puzzle is the $200 million generated by the 3 percent room tax hike approved by Nevada voters.

Even though Gibbons recommended parts of the revenue package, the seven opponents urged him to veto the budget and the tax plan. In their letter to the governor they argued the increases "will crush any chance of an economic recovery in the state."

In addition to Cobb and Goedhart, the letter was signed by Chad Christensen, John Hambrick and Richard McArthur of Las Vegas, Don Gustavson of Sparks and James Settelmeyer of Gardnerville.

Republican John Carpenter of Elko was the lone Republican in the Assembly to support the bill.