The measure filed by Nevadans for a Fair 9 Percent Gambling Revenue Tax is backed by conservative businessman Monte Miller. It would raise the top tier of gambling taxes to 9 percent for casinos that make more than $250,000 a month.
Existing rates are 6.75 percent on monthly revenues in excess of $134,000.
According to state regulators, it would affect about 170 of Nevada’s 443 license holders.
Opposition from the casino industry came quickly.
“This initiative represents a 33 percent tax increase on the gaming industry, which would be reckless and irresponsible,” Virginia Valentine, president of the powerful Nevada Resort Association, said in an email. “We are currently reviewing the language. If this effort is indeed legitimate, we will oppose it vigorously.”
Miller said the proposal to change state law would not apply to all casino activity — such as room rates, shows, shopping venues or restaurants — only revenue from wagers.
He cited an American Gaming Association report that said casinos in other states have higher tax rates — as much as 50 percent in Illinois and 26.5 percent in Louisiana.
In Indiana, Miller said the tax rate ranges from 15 percent to 40 percent. In 2010, that state’s 11 casinos paid nearly $875 million in gambling revenue taxes, more than the $835.4 million Nevada casinos paid in the same year.
Miller said his motive is fairness.
“Nevada’s individuals and small businesses are overtaxed,” Miller said. “By fairly taxing the billions of dollars that big casinos win from high-rolling gamblers, we can lower taxes and fees on individuals and small businesses who are struggling during these tough economic times.”
It’s also a counterpunch to a union-backed tax initiative that has yet to be filed but is widely anticipated.
That measure, being organized by a coalition led by Nevada AFL-CIO Secretary-Treasurer Danny Thompson, is modeled after a failed margins tax on businesses that Democrats pushed in the 2011 session.
“If the Texas-style business margins income tax is going to be on the ballot, voters are going to need an alternative,” Miller said. “We are providing voters with a reasonable approach to tax reform that does not harm small businesses.”
During legislative hearings last year, representatives of the Nevada Resort Association and the Nevada Mining Association said their industries support efforts to broaden Nevada’s tax base but are against industry-specific levies.
Both the casino tax and business tax measures seek to change state law. Organizers would need to collect more than 72,000 signatures by November to send the proposals to the 2013 Legislature. If lawmakers reject the measures or fail to act on them, they would go to voters in 2014.
Last month, another group organized by Miller filed a proposed constitutional amendment to raise the cap on net proceeds taxes mining companies pay on minerals to 9 percent from 5 percent. If enough signatures are collected, that measure would have to be approved by voters twice — in November and again in 2014 — to take effect.