Nevada Tax Reform Update
By Rich , Wightman & Company , CPAs , LLC
Executive Summary :
On June 10 , 2015 , Nevada Governor Brian Sandoval approved S . B . 483 , a package of tax measures collectively termed the Nevada Revenue Plan . The tax package includes an increase in the corporation annual business fee , an expanded payroll tax , a higher cigarette tax , and a newcommerce tax on the gross receipts of businesses with at least $ 4 million in revenues in Nevada . It also permanently extended the temporary increases in both payroll and sales taxes .
The package , totaling $ 1.4 billion in new and extended taxes over the biennium , won substantial backing despite reservations regarding the package ’ s structure , particularly the gross receiptsbased commerce tax component . Both the Nevada Legislature and Nevada voters had rejected prior attempts to impose other types of gross receipts taxes , and some of those who supported the new tax package did so while expressing a desire to revisit the decision in the future .
The provisions of S . B . 483 go into effect on July 1 , 2015 . Below is a summary of some of the key provisions related to S . B . 483 : Business License Fee Increased :
Under existing law , all Nevada businesses pay an annual business license fee of $ 200 ; a fee that had been scheduled to drop to |
$ 100 per year in Fiscal Year 2016 . Instead , the fee will increase to $ 500 for corporations , and remain at $ 200 for pass-through |
businesses . Corporations with authorized stock are also required to file initial and annual lists , with a graduated fee structure |
based on the value of the company ’ s authorized |
stock . Presently , list fees range from $ 125 to $ 11,100 depending on authorized stock value . |
Business Category |
Rate |
Business Category |
Rate |
Agriculture , Forestry , Fishing , and Hunting 0.063 % Finance and Insurance 0.111 %
Commerce Tax Imposed on Business Gross Receipts :
The new law imposes an annual commerce tax on each business entity engaged in business in Nevada . The tax is based on gross revenue apportioned to Nevada with a $ 4,000,000 standard deduction . All businesses with revenue apportioned to Nevada will be required to file a return , even if gross revenue is less than $ 4,000,000 . The rate of tax varies by industry / business category in which the taxpayer is primarily engaged . Tax rates range from . 051 percent to . 331 percent as set forth in the following table :
Mining , Quarrying , and Oil and Gas Extraction 0.051 % Real Estate and Rental and Leasing 0.250 %
Utilities and Telecommunications 0.136 %
Professional , Scientific , and Technical Services
0.181 %
Construction 0.083 % Management of Companies and Enterprises 0.137 % Manufacturing 0.091 % Administrative and Support Services 0.154 % Wholesale Trade 0.101 % Waste Management 0.261 %
Retail Trade 0.111 % Educational Services 0.281 % Air Transportation 0.058 % Health Care and Social Assistance 0.190 % Truck Transportation 0.202 % Arts , Entertainment , and Recreation 0.240 % Rail Transportation 0.331 % Accommodation 0.200 % Other Transportation 0.129 % Food Services and Drinking Places 0.194 %
Warehousing and Storage 0.128 % Other Services 0.142 % Publishing , Software , and Data Processing 0.253 % Unclassified 0.128 %
12 IREM Chapter 99