While California has been on center stage with its budget troubles, Nevada, too, has had problems. The Silver State is facing an $887 million budget deficit (by comparison, California is facing a $19.9 billion deficit). Unemployment is high, and revenues in the gaming industry fell by the largest percentage ever in 2009.
Governor Jim Gibbons (R) has proposed two tax increases (mining and sales) but in his view they’re not tax increases. “That is not a tax increase if you look at it carefully,” Gibbons said about the mining-tax proposal. “That is simply clarifying the deductions that they are allowed to take.” Well, when taxes go up it’s an increase. I’ll ignore the semantics and say that’s what’s happening.
Meanwhile, Democrats in the Nevada legislature also want to increase taxes according to a story in the Las Vegas Review Journal. Since it appears that the only people who don’t want taxes to increase in Nevada are Republicans in the legislature taxes are going up in Nevada.
As I’ve been saying about California, what must happen everywhere is that spending needs to be cut to revenues. Pension benefits will need to be cut. Public employees salaries will be decreasing in the future. That’s the reality: The public (voters) don’t want tax increases. If you’re running for office, ignoring the voters is a way to head to a new career.