October 29, 2019
29 Oct 2019

Political Update – October 29, 2019

2020 State Business Tax Climate Index

Jared Walczak
Tax Foundation

October 22, 2019

The Tax Foundation’s State Business Tax Climate Index enables business leaders, government policymakers, and taxpayers to gauge how their states’ tax systems compare. While there are many ways to show how much is collected in taxes by state governments, the Index is designed to show how well states structure their tax systems and provides a road map for improvement.

The 10 best states in this year’s Index are:

1. Wyoming
2. South Dakota
3. Alaska
4. Florida
5. Montana
6. New Hampshire
7. Nevada
8. Oregon
9. Utah
10. Indiana

The absence of a major tax is a common factor among many of the top 10 states. Property taxes and unemployment insurance taxes are levied in every state, but there are several states that do without one or more of the major taxes: the corporate income tax, the individual income tax, or the sales tax. Wyoming, Nevada, and South Dakota have no corporate or individual income tax (though Nevada imposes gross receipts taxes); Alaska has no individual income or state-level sales tax; Florida has no individual income tax; and New Hampshire, Montana, and Oregon have no sales tax.

This does not mean, however, that a state cannot rank in the top 10 while still levying all the major taxes. Indiana and Utah, for example, levy all of the major tax types, but do so with low rates on broad bases.

The 10 lowest-ranked, or worst, states in this year’s Index are:

41. Louisiana
42. Iowa
43. Maryland
44. Vermont
45. Minnesota
46. Arkansas
47. Connecticut
48. California
49. New York
50. New Jersey

The states in the bottom 10 tend to have a number of afflictions in common: complex, nonneutral taxes with comparatively high rates. New Jersey, for example, is hampered by some of the highest property tax burdens in the country, has the second highest-rate corporate income tax in the country and a particularly aggressive treatment of international income, levies an inheritance tax, and maintains some of the nation’s worst-structured individual income taxes.

Keystone’s Mission:

To recruit, support and advocate for candidates for public office who support private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.

Keystone’s Mission:

• To focus on candidate support on state legislative races and the governor’s office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth.

P.O. Box 93596 | Las Vegas, NV 89193-3596

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October 22, 2019
22 Oct 2019

Political Update – October 22, 2019

COMMENTARY: A lack of accountability, not cash, is what ails the Clark County School District

Robert Fellner
Special to the Las Vegas Review-Journal

October 19, 2019

Nevada’s education woes reflect a lack of accountability, not insufficient funding.

Nevada is projected to spend $10,197 per student this school year, which reflects a near tripling in inflation-adjusted, per-pupil education spending since 1960.

Sadly, this dramatic increase in spending has not translated into improved results. Nevada schools consistently rank among the worst in the nation, with only 28 percent of eighth-grade students performing at grade level in both reading and math.

Some blame this continued failure on insufficient funding and argue that things won’t get better unless Nevadans agree to pay substantially higher taxes.

But there is little evidence to support the claim that higher taxes and more spending will lead to better results. In fact, a recent study commissioned by the Legislature found that the amount Nevada currently spends — including both state and local expenditures — is already sufficient “to ensure all students can meet all state standards and requirements.”

Rather than seeking to burden Nevadans with a massive tax hike that is unlikely to boost performance, reformers should instead focus their efforts on addressing the root cause of the problem: the system’s complete lack of accountability.

Take, for example, the so-called evaluation systems used by the Clark County School District.

More than 100 district schools have for years received failing grades from the state, including at least one school where an incomprehensible 99 percent of students are below grade level in math.

Yet in a twist that would make Orwell proud, school officials claim that the district hasn’t had a single ineffective principal or administrator anywhere for at least the past four years (No bad principals in Clark County, evaluators say).

A similarly useless evaluation system is in place for teachers, which saw only 25 of the nearly 20,000 teachers evaluated, or 0.1 percent, rated as ineffective for the 2017-18 school year.

*IMPORTANT*

Quote of
the week

 


Quote:

“With spending at $10,197 per student, the real problem facing Nevada’s public schools stems from a lack of accountability, not insufficient funding.”

Robert Fellner
Nevada Policy Research Institute

These groups of state employees want recognition under new law

John Sadler
Las Vegas Sun

October 20, 2019

When Ken Edmonds moved to Las Vegas from Chicago, he was surprised at how his co-workers viewed management. Coming from a job in Chicago, he said was used to union representation.

Edmonds is a health care worker at Desert Regional Center, a state agency that offers services to adults and children with developmental and intellectual disabilities. He and his co-workers at the center have joined state corrections officers as the first groups of state employees to seek collective bargaining under legislation signed into law by Gov. Steve Sisolak this year. Both employee groups seek recognition as members of the American Federations of State, County and Municipal Employees. State troopers and others have also filed for recognition as members of the Nevada Highway Patrol Association.

Keystone’s Mission:

To recruit, support and advocate for candidates for public office who support private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.

Keystone’s Mission:

• To focus on candidate support on state legislative races and the governor’s office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth.

P.O. Box 93596 | Las Vegas, NV 89193-3596

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October 15, 2019
15 Oct 2019

Political Update – October 15, 2019

 

Counties, cities spent millions lobbying the Legislature

Riley Snyder
The Nevada Independent

October 13, 2019

Local governments and cities spent more than $3.9 million lobbying the 2019 Legislature, according to a state report that found total lobbying spending by governments hit the highest amount in more than a decade.

The report, which was compiled by the state Department of Taxation, is the product of a law that requires all local governments — everything from cities and counties to police departments, school districts and hospitals — to disclose any expenditures above $6,000 on “activities designed to influence the passage or defeat of any legislation.”

After hitting a pre-recession high of $3.99 million during the 2007 Legislature, the $3.9 million spent on lobbying activities in 2019 marked the second highest spending totals reported since the disclosure law was passed in 2001 — good for nearly $32,600 of taxpayer money spent every day of the 120-day legislative session.

Local governments, which in some cases have budgets that rival or even eclipse the state’s budget, say that lobbying expenditures are justified given the vast number of bills — law enforcement, open meeting laws, financial administration and public records — that affect counties and cities. But some critics have raised concerns with allowing governments to use taxpayer dollars for lobbying purposes that may go against the wants of the public.

“What governments are promoting or pushing with lawmakers isn’t always in line with what taxpayers or citizens are going to want, and yet, us taxpayers are still funding it no matter what, even if we disagree with it,” Michael Schaus, a spokesperson for libertarian-leaning Nevada Policy Research Institute (NPRI) said in an interview.

Initial reporting of lobbying expenditures were due a month after the end of the legislative session, but following several Nevada Independent requests to top lobbying-spenders, the Department of Taxation revised its report and issued a new version this week.

*IMPORTANT*

Quote of
the week

 


Quote:

“Most state and local governments are prohibited from running budget deficits, That’s good, but it hasn’t kept them from pushing costs into the future. They’ve done that by short-changing their public pension plans. In 2017, the American Legislative Exchange Council estimated that state and local governments had a $6 trillion unfunded liability in their pension obligations.”

Las Vegas Review-Journal

EDITORIAL: Taxes cost Americans more than amount spent on food, clothes and health care

Las Vegas Review-Journal
October 11, 2019

If you think Americans pay a lot in taxes, the numbers show you’re right.

Last year, the average American household unit spent $18,600 on taxes. That included more than $9,000 on federal income taxes, $5,000 on Social Security taxes and more than $4,400 on state and local taxes. That’s according to data from the Bureau of Labor Statistics, analyzed by Terence Jeffrey with CNS News.

Keystone’s Mission:

To recruit, support and advocate for candidates for public office who support private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.

Keystone’s Mission:

• To focus on candidate support on state legislative races and the governor’s office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth.

P.O. Box 93596 | Las Vegas, NV 89193-3596

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October 8, 2019
08 Oct 2019

Political Update – October 8, 2019

 

EDITORIAL: The dangers of turning the keys over to government unions

Las Vegas Review-Journal
October 3, 2019

During the recent legislative session, Gov. Steve Sisolak championed and signed a bill allowing state workers to collectively bargain. The dangerous fiscal ramifications of this move will become apparent in coming years. For a preview, however, Nevadans need look no further than Illinois to see what happens when Democrats beholden to public employee unions dominate the political process.

The Land of Lincoln is bleeding residents, who are fleeing the state’s burdensome taxes and moribund economy. From 2014 through 2018, the state lost 150,000 people, with 45,000 moving out last year alone. Middle-class families are socked with the second-highest property taxes in the nation, their tax bills often exceeding their mortgages. The Illinois Policy Institute notes that, since 1990, the state’s “residential property taxes have grown 3.3 times faster than the state’s median household income.”

Corruption, an entrenched progressive political class and cronyism certainly haven’t helped Illinois. But the inordinate power wielded by Illinois government unions is also a significant factor in the state’s population decline. Public employee unions run Illinois. Each election cycle, government unions pour millions into electing their favored Democratic candidates to state and local offices. They get paid back in spades, with ever-escalating taxes on private-sector workers forced to fund their contracts and benefits.

Illinois state workers are among the best paid in the country and make “up to 60 percent higher than their private-sector counterparts,” the IPI reports. In addition, public employees enjoy generous pension benefits that, the state Supreme Court has ruled, cannot be reduced for current workers or retirees.

Meanwhile, Illinois is a fiscal basket case. Its legislature failed to pass a budget for fiscal 2016 and 2017 and faced a deficit approaching $15 billion two years ago. The state’s credit rating hovers near junk-bond status. Outstanding pension obligations now total north of $160 billion. Many cities now must forgo basic services and lay off workers in order to cover mushrooming pension costs. For instance, East St. Louis was recently forced to turn over $2.2 million to the state in order to fund firefighter retiree checks.

*IMPORTANT*

Quote of
the week

 


Quote:

“Nevada is not Illinois. But it should be a red flag to Silver State pols about the dangers of ignoring public pension reform and the inevitable fiscal risks associated with empowering government unions at the expense of state taxpayers.”

Las Vegas Review-Journal

Nevada attorney general sides with state Democrats in tax fight

Noell Evans
The Center Square

September 25, 2019

Nevada Attorney General Aaron Ford is siding with Democrats in a lawsuit filed by Republican lawmakers challenging two tax-related bills that had passed the state House and Senate.

Ford filed a motion in the Carson City District Courtroom of Judge Todd Russell claiming that the bills, as passed, were both legal and legally passed. Ford suggests that the case be dismissed “with prejudice.”

At issue is the passage of SB551 and SB542 earlier this year. The bills, which dealt with existing taxation levels, passed by a majority but not a two-thirds one. Republican lawmakers argue that because of the taxation repercussions in the bills, a two-thirds majority was needed for passage. They cite two voter-initiatives – one in 1994 and the other in 1996 – that call for the two/thirds majority passage.

Keystone’s Mission:

To recruit, support and advocate for candidates for public office who support private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.

Keystone’s Mission:

• To focus on candidate support on state legislative races and the governor’s office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth.

P.O. Box 93596 | Las Vegas, NV 89193-3596

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October 1, 2019
01 Oct 2019

Political Update – October 1, 2019

 

Gross Receipts Taxes Face Policy and Legal Challenges

Stephen P. Kranz, Diann Smith, Joe Bishop-Henchman
National Law Review

September 24, 2019

“Generally, the only places with gross receipts taxes today are U.S. states and developing countries.” –Professor Richard Pomp, University of Connecticut

The resurgence of GRTs is surprising, given they had all but disappeared by the end of the 20th century. Kentucky, Michigan, New Jersey and West Virginia had recently repealed theirs. Every country that had a gross receipts tax, or turnover tax as they were historically called, recognized their flaws and switched to other forms of taxation by the 1970s. Public finance scholars are very critical of gross receipts taxes for the incredible damage they inflict on an economy, their lack of transparency, their imposition even on unprofitable businesses, and the economic distortions that come from the tax’s inherent “cascading” or “pyramiding”—embedding taxes within taxes, through each stage of the production chain. Adam Smith, writing in The Wealth of Nations, blamed Spain’s alcavala gross receipts tax for their national economic decline, and studies have found that developing countries adopt gross receipts taxes but switch away from them once their economy and tax collection system mature.

So, why the sudden popularity? It’s simple, really: GRTs raise enormous sums of revenue with a deceptively low tax rate, and are collected by a relatively small number of taxpayers (businesses). Oregon, for instance, estimates that their new 0.57% CAT will raise over $1 billion per year for Oregon schools, compared to the $736 million raised by the 7.6% corporate income tax. San Francisco expects to raise $250 million annually from a recent gross receipts tax increase, imposed on just 400 firms. GRTs are also a way to shift the overall tax burden from in-state businesses onto businesses with capital-intensive production, or businesses that sell nationwide or worldwide.

If GRTs in practice don’t strike you as simple, you’re not alone. Firms doing business in states that have adopted GRTs face legal and compliance issues such as easy-to-trigger nexus thresholds, how to handle nexus questionnaires, apportionment, whether to pass it forward to customers, definitional disputes, whether to adjust business processes to minimize liability, and a ramp up in administrative rulemaking. Some states have ratcheted up complexity as they try to mitigate pyramiding—for example, the Nevada Commerce Tax has 27 different tax rates—and which category a business falls in can be a difference of tens of millions of dollars in tax liability.

*IMPORTANT*

Quote of
the week

 


Quote:

“If a tax is scheduled to expire, extending it is increasing the tax burden.”

Americans for Tax Reform Twitter post on Nevada’s tax extention legal challenge

2019 Legislative Report Card

Nevada Policy Research Institute
September 2019

It is to ensure that Nevada’s elected officials are held to account for the votes they cast that Nevada Policy publishes this legislative report card after every session. However, the way a lawmaker votes only tells part of the story.

Some of the most significant legislative actions occur behind the scenes, long before any vote is ever taken. To that end, Nevada Policy thought it important to go beyond merely the bills that were voted on in both chambers, and recognize specific lawmakers for their actions before votes were ever even cast.

Given the landscape of modern politics, these issue-specific “rankings” will prove crucial for citizens and activists who are looking to advance liberty by working beyond partisan politics, and engaging lawmakers on key issues.

Keystone’s Mission:

To recruit, support and advocate for candidates for public office who support private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.

Keystone’s Mission:

• To focus on candidate support on state legislative races and the governor’s office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth.

P.O. Box 93596 | Las Vegas, NV 89193-3596

To ensure that you continue receiving email updates,

please add Info@KeystoneNevada.com to your address book or safe list.
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