FILE - Retail sales tax cash register

On Dec. 15, 2020, county officials finished verifying signatures for the Sales Tax Increase for Public Schools Initiative and the Gaming Tax Increase on Monthly Revenue above $250,000 Initiative. The initiatives will be considered during the 2021 legislative session that convenes on Feb. 1. If the legislature does not pass or the governor does not sign the initiatives, they will be put on the November 2022 ballot.

Fund Our Schools is sponsoring the Sales Tax Increase for Public Schools Initiative and submitted 190,192 raw signatures. County officials verified 137,791 signatures (72.4%) as valid.

Nevadans for Fair Gaming Taxes is sponsoring the Gaming Tax Increase on Monthly Revenue above $250,000 Initiative and submitted 201,935 raw signatures. County officials verified 148,605 signatures (73.6%) as valid.

The Sales Tax Increase for Public Schools Initiative would increase the state’s Local School Support Tax by 1.5 percentage points with revenue dedicated to public schools. An additional 0.35% sales and use tax with dedicated revenues for public education was imposed on June 30, 2015, which brought the current total tax to 2.6%. The new total Local School Support Tax would be 4.1%. The tax is expected to generate $340 million according to the Fiscal Analysis Division of the Legislative Counsel Bureau.

Local sales tax rates vary, creating a range of total existing sales tax rates in Nevada from 6.85% to 8.375%. The initiative would increase the combined state and local sales tax rates in Nevada to a range of 8.35% to 9.875%. If approved by the state legislature, the tax would take effect July 1, 2021. If sent to the ballot and approved by voters at the 2022 general election, the tax would take effect on Jan. 1, 2023.

The Gaming Tax Increase on Monthly Revenue above $250,000 Initiative would increase the rate of the fee on monthly gross gaming revenue above $250,000 to 9.75%. Currently, the Nevada Gaming Commission collects a tax on monthly gross revenue from licensed gaming facilities. The tax is imposed according to the following tiers:

  • 3.5% on gross revenue of the licensee which does not exceed $50,000 per month,
  • 4.5% on gross revenue of the licensee which exceeds $50,000 but does not exceed $134,000 per month, and
  • 6.75% on gross revenue of the licensee which exceeds $134,000.

If approved by the state legislature, the tax would take effect July 1, 2021. If sent to the ballot and approved by voters at the 2022 general election, the tax would take effect on Nov. 22, 2022.

The committees sponsoring the two tax initiatives have received all of their funding from the Clark County Education Association. Fund Our Schools has reported $876,536.59 in cash and in-kind contributions, and Nevadans for Fair Gaming Taxes has reported $817,920.02 in cash and in-kind contributions.

At the outset of the signature campaign, John Vellardita, the executive director for the Clark County Education Association, said, “Our school system statewide is ranked last in the country in funding. And we’ve had three studies in the past six years, independent of each other, and they all came to the same conclusion that we need to adequately fund our schools to the tune of over $1 billion a year. … Our classrooms are the largest in the country, so this money would go toward reducing class size, it would go toward the type of resources and books in the classroom as well as getting teachers out here.”

The Nevada Resort Association and the Las Vegas Metro Chamber of Commerce are opposed to the measures. The Nevada Resort Association said, “As Nevada’s largest industry and economic engine continues to do all it can to recover and bring employees back to work, now is not the time to target the resort industry with a 44 percent tax increase that would further damage Nevada’s recovery efforts, create permanent job losses and further jeopardize capital investment and future economic development.”

Between 1996 and 2020, Nevada ballots have featured 29 initiatives with 21 (72.4%) approved and eight (27.6%) defeated.

Nevada is one of eight states with a process for indirect initiated state statutes. Indirect initiated state statutes go to the legislature when enough signatures are gathered, rather than going directly to the ballot. Indirect initiatives only go to the ballot if they are not approved by the legislature or are vetoed.