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Nevada One Step Closer to Repealing Sandoval’s Commerce Tax



Nevada residents have been dealt a victory and are one step closer in their effort to repeal Governor Brian Sandoval’s Commerce Tax. Judge James Wilson handed down a ruling on Wednesday in Carson City that will allow residents to begin gathering signatures for a repeal referendum. The new tax is the largest tax increase in the state’s history and nearly identical to a tax proposal that was voted down by more than 80 percent of voters on the 2014 ballot. The petition was brought by the political action committee, RIP Commerce Tax, created by State Controller Ron Knecht.

An opposing political PAC, Coalition for Nevada’s Future, that works on behalf of the governor’s Commerce Tax has been fighting to end any effort by the people to gather the 55,000 signatures needed to get the measure on the ballot in 2016. Initial statements from the PAC’s two attorneys indicate they will coordinate with their clients as to whether an appeal to Wilson’s decision will be filed.

Knecht, who is leading the stampede to repeal the tax, previously offered an alternative budget during the 2015 legislative session that provided for education spending without raising taxes. The State Treasurer, Dan Schwartz, and Assemblyman Jim Wheeler also offered different proposals for the state budget that would eliminate any need to implement tax increases. Their alternate suggestions were not considered by the legislature.

Knecht is not the only heavy hitter attempting to repeal the Commerce Tax. Chuck Muth, president of the nonprofit Citizen Outreach, filed a similar petition to repeal the governor’s taxes of Senate Bill 483. Muth’s language was shot down by Judge James Todd Russell on the grounds it violated the single subject rule. His request is slightly different from Controller Knecht’s petition that only repeals the Commerce Tax portion of the governor’s tax package. Muth is attempting to repeal Sandoval’s 1.1 billion dollar tax increase in SB 483 that encompasses a variety of taxes. He argues his petition uses the identical language as Senate Bill 483 and if that violates the single subject rule, then so does the bill itself, because legislators are bound to follow the same single subject rule when writing legislation.

Over 450,000 Nevadans voted against a new tax on business during the last election, and the court’s ruling puts Nevada one step closer to repealing Sandoval’s Commerce Tax. A handful of Republicans and all of the Democratic legislators ignored the wishes and direction of the voters and passed SB 483. The Republicans won a majority in the State Assembly and State Senate in 2014, and they all campaigned against increasing taxes. However, once elected, several Republican legislators came to the aid of the governor and voted to pass the widely unpopular tax. Sandoval himself, seeking a second term in 2014, campaigned against raising taxes. In a State Senate hearing chaired by Senator Michael Roberson, Mike Willden, Sandoval’s chief of staff, revealed that they had been working on the budget and tax package for over a year – the same year Sandoval was campaigning against raising taxes.

Newly elected Republicans and Nevada voters who opposed the tax increase are fighting from all angles available to repeal the tax. Assemblyman Brent Jones, a leader for conservative Republicans, has developed the Contract with Nevada. The contract has 10 common sense points with repealing the Commerce Tax as the number one issue. If the ballot measures fail, electing enough of those who support the Contract with Nevada could emerge as another method to repeal the unfriendly business tax.

All Republicans who teamed with the Democrats to pass the Commerce Tax have drawn primary opponents for the next election cycle. Dissension within the Republican Assembly Caucus is growing between the conservative and moderate members in an all-out war leading into the 2016 primaries. If the over 450,000 Nevada voters remain committed to preventing tax increases, the moderate Republicans who voted for the Commerce Tax will face an uphill battle in their re-election campaigns.

Legal petitions for the referendum to repeal the massive tax hike will keep the issue at the forefront, making it impossible for voters to forget. According to Knecht, his PAC will begin collecting signatures immediately because he believes any appeal to Judge Wilson’s ruling will fail. The state controller’s victory puts Nevada one step closer to repealing Governor Brian Sandoval’s Commerce Tax.

Opinion by Lucy Lane

Associated Press – Judge rules Nevada Commerce Tax repeal effort can advance
Reno Gazette Journal – Group files petition to repeal new Nevada Commerce Tax
Nevada News and Views –  Debunking the “Desperate Arguments” against Commerce Tax Referendum

Image Courtesy of Nevada Department of Agriculture’s Flickr Page – Creative Commons License