Nevada Supreme Court to hear commerce tax referendum May 2

CARSON CITY — The Nevada Supreme Court will hear oral arguments May 2 on whether a referendum to put the state’s new commerce tax to a public vote meets legal muster to continue.

A movement called RIP Commerce Tax, led by state Controller Ron Knecht, hopes to repeal the tax that was part of a $1.5 billion tax package pushed by Republican Gov. Brian Sandoval and approved by a two-thirds majority of the 2015 Legislature.

The tax affects businesses with $4 million or more in annual gross revenue and is projected to raise about $60 million annually when other offsets are factored.

A group of business interests called the Coalition for Nevada’s Future challenged the referendum, arguing the petition is legally defective and fails to tell voters how the lost revenue would be addressed or potential ramifications.

Carson City District Judge James Wilson in December rejected those arguments and allowed the signature-gathering process to proceed. The judge said the Nevada Constitution gives voters the right to repeal a law they don’t like and that if approved, it would be up to lawmakers to deal with the consequences.

The business coalition appealed Wilson’s ruling to the high court.

If the referendum makes it to the ballot and is approved by voters, the commerce tax would be repealed.

But if the measure goes to the ballot and is rejected — meaning the commerce tax survives — the current statute could only be changed by another public vote. That would prevent lawmakers from tinkering with rates or other details during legislative sessions.

Knecht on Friday said volunteers have gathered about 15,000 signatures and supporters are working on raising money to hire signature collectors.

They need to collect about 55,000 signatures by June 21 to qualify the petition for the Nov. 8 general election ballot.

Some signatures were collected in Pahrump on April 14 when Assistant State Controller Geoffrey Lawrence discussed the effort to repeal the commerce tax during an event hosted by Assembly District 36 candidate Tina Trenner.

Contact Sandra Chereb at schereb@reviewjournal.com. Find @SandraChereb on Twitter.