Last night, I was on the Ralston Live Show. It was my first extended TV interview. Candidly, I was a bit nervous. Nevertheless, I approached the interview as I would a conversation over coffee and attempted to give clear, thoughtful and coherent answers to his questions. Mr. Ralston asked fair questions and pressed me for clarification on some of my positions and views. For my first interview, I thought I did a good job.
However, this morning Mr. Ralston wrote in his Morning Flash, “Jason Guinasso was dodging my simple question: Do you support last session’s tax package?” When I first read this critique I was internally defensive because I do not believe I was evading his question at all. But, upon reflection, I should have answered “Yes” to his question first and then provided my explanation and rationale, rather than providing my explanation and rationale and then answering “Yes.” I will learn and grow from this experience.
I do not want to be a “talking point” politician. If I am going to be elected to serve my community and the citizens of the State of Nevada, I want them to know exactly what I think on issues that are important to them. In this spirit, I am going to provide my answer to the question presented in writing.
To begin with, I want to make this abundantly clear to those who are considering whether to support me or not: I support the Nevada Revenue Plan passed by the Nevada Legislature and signed into law by the Governor last session because it accomplishes three important Conservative policy objectives:
(1) it funds the most comprehensive education reform in State history (reforms Conservatives in Nevada have been fighting for over 25 years);
(2) it balances the budget in a manner that is sustainable long term by diversifying the portfolio of revenue sources our State relies upon for revenue to fund policy priorities and legally mandatory benefits and services; and
(3) it fully funds economic development and diversification.
With respect to the Commerce Tax, I was not in the Legislature when the Commerce Tax was debated and voted on, but I intend to be in the Legislature in 2017 when my role will be one of a Conservative Legislator evaluating whether this tax treats industries fairly, whether it needs to be changed or altered, whether it has unintended consequences, and whether the education reforms that I support are being properly implemented. I am not running to be elected a political pundit; I am running to be a Legislator. Therefore, my inclination is to give deference to the the hard work that our elected officials put into the policy decisions that they made. I really don’t think it is appropriate for a candidate like me to take credit or blame for decisions made by my predecessors. My job is to articulate to the best of my ability what I am would like to do as a Legislator going forward if I am elected.
I am very sensitive to the fact many people are angry about the passage of the Commerce Tax because they feel that they were deceived by politicians who told them that they were opposed to a gross receipts tax and then, when elected, voted for a gross receipts tax.
I understand their perspective. As an active member of the Chamber PAC in 2012, 2013 and 2014, I worked with a coalition of people and organizations to help to defeat the Margins Tax. I also am Conservative Republican who is committed to priority based tax and spending policy. I can say this with conviction because, as a business owner who pays taxes and as an attorney who represents business of every size and in every industry, I intimately understand the impact tax and spending decisions have on businesses.
However, I do not think the anger many people are expressing about the Commerce Tax is based on facts. The Margins Tax and the Commerce Tax are not the same tax. While both the Margins Tax and the Commerce Tax are both a tax on gross receipts, they are different taxes in four important ways:
- The Margins Tax was a proposed tax on gross receipts of companies that make $1,000,000 in gross receipts. This proposed tax would have applied to every dollar earned. The Commerce Tax applies to companies that make $4,000,000 in gross receipts. This tax applies to every dollar earned over the $4,000,000 threshold.
- The Commerce Tax provides a 50% credit against the Modified Business Tax (MBT). The Margins Tax did not offer any such credit.
- The Commerce Tax provides an additional credit against the MBT if the tax raises more than 4% of the revenue projected. The Margins Tax did not offer an such credit.
- The education reforms and programs that the Commerce Tax funds are earmarked for those programs only and they cannot be subjected to collective bargaining.
Presently, we do not have any data to analyze the performance of the Commerce Tax or the education programs and reforms it is funding. Therefore, I believe it is premature to judge the merits of the tax.
Further, I do not support putting a ballot measure to repeal the Commerce Tax to the voters because, if the measure fails, this iteration of a gross receipts tax will be locked into statute. Consequently, my hands as a legislator will be effectively tied and I will not be able to consider (1) whether the education reforms the tax is funding are working; and (2) whether the tax is fairly applied and working the way it was intended to work. Additionally, as a legislator, I will not be able to fix flaws in the tax, consider alternatives to the tax, and/or repeal the tax. (See Fiscal Impact Statement http://nvsos.gov/Modules/ShowDocument.aspx?documentid=3951).
By addressing anger over the commerce tax by referendum, we risk locking the Commerce Tax into statute as is in perpetuity unless there is a subsequent ballot measure put before the people. In this regard, Article 19, section 1, sub. 3, of the Nevada Constitution specifically provides, “If a majority of the voters voting upon the proposal submitted at such election votes approval of such statute or resolution or any part thereof, such statute or resolution or any part thereof shall stand as the law of the state and shall not be amended, annulled, repealed, set aside, suspended or in any way made inoperative except by the direct vote of the people. If a majority of such voters votes disapproval of such statute or resolution or any part thereof, such statute or resolution or any part thereof shall be void and of no effect.”
On the other hand, if the repeal effort is successful, Legislators would be left with having to either replace $120,000,000 in lost revenue of the next two years and/or cut educational reforms and programs the bill was passed to fund. Here are some of the major Education Reforms passed last session:
• The nation’s most aggressive school choice options -ESA’s(SB302),
• Opportunity Scholarships (AB165)
• The Charter Harbor Master Fund(SB491)
• The CCSD Break-up bill
• The Achievement School District (AB448)
• Additional funding for GATE, Zoom Schools, Victory Schools, Read by Three, expanded full-day pre-K, Career and Tech Education expansion, technology grants and much more.
As a long time advocate for education reform, I am concerned losing any of these reforms would be a huge step backwards. I am not saying cutting budgets and having a more efficient budget should not be a priority when budgeting. There may be places to cut to recover the revenue losses? I just do not know because I do not have enough information to consider what could or should be cut. I would not want to cut any of the education reforms passed last Legislative Session without giving some time to see how effective they are.
My commitment, if elected, is to be authentic and honest and to thoughtfully work for solutions that promote growth and opportunity as we move Nevada to a new and exiting future.
Rather than look backward and focusing on disappointments and frustrations about politicians and policies we may or may not agree with, I want my campaign for Assembly to be focused on looking forward. Nevada is poised to experience an unprecedented era of economic growth and opportunity. I want to lead our community into this exciting new era.