Tax increases denounced

CARSON CITY -- In what seemed like a political campaign message, Gov. Jim Gibbons said Wednesday that the "Buckley/Horsford Tax Increase of 2009" will hurt the Nevada economy and citizens who already are suffering because of the recession.

"Working families are suffering through foreclosures, layoffs, higher gasoline prices and soon higher prices for electricity," Gibbons said in a prepared statement. "The sales tax increase is just another slap in the face to citizens who have already been forced to get by with less."

Most of the $1 billion in tax increases approved by the Legislature went into effect Wednesday. The state sales tax rate was increased by 0.35 percentage points, making the rate in Clark County 8.1 percent, one of the highest in the nation.

At the same time, the payroll tax paid by businesses increased to 1.17 percent of each employees' wages, up from 0.63 percent. The annual business license fee was doubled to $200 a year.

An increase of 3 percentage points in the room tax rate in Clark County and a small part of Washoe County also went into effect Wednesday.

A 10 percent increase in car registration taxes goes into effect Sept. 1.

A study by Jeremy Aguero, principal with Applied Analysis in Las Vegas, found a family earning $60,858 a year will pay $87 more a year in sales and car registration taxes.

Larger businesses will be hit with more than 80 percent in business tax increases.

Since the end of the legislative session on June 2, Gibbons has been referring to the tax package as the Buckley/Horsford tax increase after Senate Majority Leader Steven Horsford, D-Las Vegas, and Assembly Speaker Barbara Buckley, D-Las Vegas. Buckley could be an opponent to Gibbons in the 2010 governor race.

During end-of-sessions statements, Horsford and Buckley both defended the Legislature's decision to raise taxes.

"I feel like we did our job," Horsford said. "We took a very difficult situation, the economy, the state having the worst budget (shortfall) in America ... and we were able to pass a balanced budget."

Buckley said Nevada was "facing probably the worst economic times the state has ever seen."

"At some point, we have to act like grown-ups," she said at the time.