Monday, January 20, 2003

CARSON CITY, Nev., Jan. 20 (UPI) — Nevada’s governor was expected to lay the cards on the table during his State of the State speech Monday night in an appeal for a record tax increase to help close a $704 million revenue shortfall over the next two years.

Kenny Guinn has made it no secret that he believes tax hikes are necessary to keep state services at current levels as the population steadily increases, although some Republican leaders in the Legislature have said publicly that the Democratic governor has not convinced them of the need for a tax increase.

“When someone says we don’t have a revenue problem, rather we have a spending problem, I take that as a personal insult to the staff, myself and the leadership,” Guinn told the Las Vegas Review-Journal recently.

As a means of generating more revenues in a state that does not have an income tax, Guinn was expected to propose 0.25-percent increases in Nevada’s taxes on gaming and business income as well as hikes in cigarette and liquor taxes and a 6.5-percent tax on so-called spectator amusements that range from attending professional sporting events to movie rentals and tickets.

The proposals, which were to be formally unveiled during Guinn’s speech in Carson City, have been stirring up objections from the business community, however the governor has largely dismissed the complaints and has stuck to his contentions that more taxes are needed after four consecutive years of spending cuts.

Some political observers have warned that Guinn’s seemingly prickly stance on taxes could alienate Republican legislators, whose votes will be needed in order to pass the budget by the required two-thirds majority.

“It’s a mistake to make it personal,” one Democratic source told the Review-Journal. “He is going to need those people…and the governor is not well-advised to make statements that harden their positions.”

The Legislature will be in session for 120 days starting Feb. 3.

(Reported by Hil Anderson in Los Angeles)

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