Mining tax plan raises stakes in final days of Nevada legislature
Posted on Saturday May 29, 2021 | 11:20 p.m.
Updated on Saturday May 29, 2021 | 11:20 p.m.
CARSON CITY, Nevada (AP) – Lawmakers in Nevada presented a proposal on Saturday night to impose additional taxes on mining, opening the door to a consensus between an industry that has long sought to protect its unique tax structure and reformers who wish to increase state spending on education.
Under a deal brokered by lawmakers on both sides, mining lobbyists and the state’s largest teachers’ union, the state will allocate more dollars from its net mineral product tax to the state. education and add a gross income tax which is phased and will only apply to mines. this gross amount of more than $ 20 million per year.
Mines that report gross revenues of $ 20 million to $ 150 million will be charged a 0.75% excise tax, while a 1.1% tax will be charged on mines that report an amount higher. The gross income tax will only apply to silver and gold mines, excluding other minerals like gypsum, lithium or copper and will allocate a large part of the funding to education .
Tire Gray, the president of the Nevada Mining Association, said he couldn’t explicitly support a tax hike. But the measure introduced on Saturday, which does not have a sunset clause, “is really meant to be a definitive answer to the question of whether or not mining is paying its fair share,” he said.
“Some would say that mining has not paid its fair share. This bill will ensure that this argument is no longer viable, ”he said.
He said the industry preferred the current proposal on the table to the three tax proposals tabled last summer, which would have raised $ 147 million to $ 607 million in annual revenue. Assembly Speaker Jason Frierson said Saturday’s proposal would generate around $ 170 million every two years.
Battles over how to tax mining in the state have raged since prospectors struck silver in the 19th century. The state’s constitution has since required that mining companies be taxed at less than 5% of what’s known as net proceeds – profit minus deductions for certain costs.
The state’s mines produced $ 8.2 billion in silver, copper, and other minerals in 2019 – more non-fossil minerals than any other state. They collectively paid $ 61 million in taxes to the state that year.
Because neither Republicans nor Democrats command the two-thirds supermajority required in Nevada to raise taxes, its passage will require support from both sides. At an impromptu meeting of the Ways and Means Committee held in the Assembly, lawmakers from both sides supported the introduction of the bill. But he still has to empty both chambers with a two-thirds majority.
Senate Majority Leader Nicole Cannizzaro said there were still “negotiations going on” and did not close the door on resolutions passed last summer if discussions deteriorated. She said she was optimistic about the prospect of providing additional funding to schools.
“Asking for additional income from mining – I think – is an investment in our children,” she said.
In the past, Republicans have argued that the mining industry is a key component of rural economies and that excessive taxation could jeopardize thousands of jobs in mines and the businesses that serve employees and their families.
Progressive activists point to Nevada’s ranking relative to other states for education spending per K-12 student (44th) and health spending per capita (48th) and say mines can afford to pay more. They celebrated the tabling of the bill on Saturday night as a step forward.
“While we will continue to push for what Nevadans really deserve, this proposal will meet the needs of the people in a meaningful way and provide our state with the funding needed to immediately maintain and strengthen essential public services,” said Laura Martin, the executive. director of the Progressive Leadership Alliance of Nevada.
Mining tax reform lost a two-thirds vote on the approval needed to go through the Statehouse last summer. But as consolation, with simple majorities, Democratic lawmakers decided to take the first step in pushing forward mining tax proposals in the 2022 poll.
Throughout the second half of the legislative session, mining industry representatives and Democratic Party members both said they would rather reach a compromise deal in Carson City than risk the uncertainty of ‘a voting measure – the presence of which could spill over to other races. in the ticket.
Although Republicans are in the minority in both the Senate and the Assembly, they hope the two-thirds requirement for the tax proposals will give them the power to extract concessions from Democrats.
In return for their support, the Republican demands included returning funding to education initiatives such as the Opportunity Scholarships, which the then-Republican majority created in 2015 to enable low- and middle-income families. to pay tuition fees in private schools. Democrats have chosen to cut the program in 2019 and the proposal overturns that decision.
Sam Metz is a member of the Associated Press / Report for America Statehouse News Initiative corps. Report for America is a national, nonprofit service program that places reporters in local newsrooms to report on secret issues.