Taxes, Ethics, Caffeine

I am at the end of a second long day in Carson City.

Given the Governor’s promised veto of any budget package that includes a tax increase, there is a legislative self-imposed deadline of Friday to get the bills to the Governor so that there is enough time for a veto override.

Things were slowed down a bit tonight as an ethics bomb went off in the Senate Chamber. Senator Raggio has been threatened with an ethics complaint if he votes on the tax package because a member of his law firm testified on a tax proposal a week or two ago. Therefore, Raggio asked for a legal opinion from the legislative council and received a letter that stated he should abstain from voting on the issue.

This prompted a rushed bill that would allow and require every legislator to vote on bills of “immense statewide importance.”

There always seems to be wrinkles in the rush to close…

The tax bill finally has a name: SB 429. It would raise $781.2 million total. The revenue breakdown is as follows:

-Sales tax increase of 0.35 percent: $280 million
-Tiered Modified Business Tax rate: $346 million
-Doubling of the business license fee: $61 million
-Changes to governmental services tax on vehicles: $94 million

The payroll tax rate would be further complicated by reducing the tax rate from 0.63% to 0.5% on all annual payroll over $250,000, while increasing the rate to 1.17% on payroll above that amount.

While the Chamber understands the need for small business tax relief, we are concerned about instituting a hiring disincentive for any company that is near the $250,000 cap.

Up later this morning in Senate Finance is SB 427, the PERS reform bill. While it is a good start, it does not include a minimum retirement age and some other details.

Stay tuned, as things are moving fast….