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Study: Nevada Tax System Not Effective

"`The effective tax rate on licensees in terms of the percentage of total revenue paid to the state has fallen from a peak of 9.02 percent in 1993 to 8.25 percent in 2002,' noted the study, funded by the Nevada Resort Association, the industry's Carson City lobbying arm.

"…The casino industry pays less of its total revenues to the state than it used to. If Nevada's casinos paid 9.02 percent rather than 8.25 percent to the state on roughly $18 billion in 2002 revenue, state coffers would have collected an extra $138.6 million in revenue.

"But Station Casinos Chief Financial Officer Glenn Christenson said the industry doesn't run from the fact, despite its suggestion that the state's biggest industry could pay more.

"…Christenson and other industry insiders said the growing diversification of the casino industry is the reason for the industry's declining effective tax rate.

"The importance of nongaming resort revenue is rapidly increasing, with nongaming revenue jumping from 29.9 percent of total resort revenue in 1975 to 48.5 percent in 2002.

"…About 37 percent of the state's general fund budget in the 2001-03 biennium comes from gaming taxes and the casino entertainment tax.

"…Deluxe hotel rooms, gourmet restaurants and upscale stores don't contribute as much to the state's coffers as do gambling or entertainment revenues, industry executives said.

"…The current system is more than inefficient, [Nevada Resort Association President Bill Bible] said. It's unfair.

"Nevada's tax system targets the casino business while it leaves other significant businesses practically unscathed, he said…"

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