Nevada Looking for More Taxes from Mining

For over 150 years, mining operations in the state of Nevada have had a unique protection from paying taxes. On November 4th, Nevada voters will have the chance to remove those special protections from the state constitution and allow the Legislature to update the mining tax system to reflect modern times.

 

Consider, in 2013 Nevada's gold industry brought in $8.1 billion but mining companies paid only $74 million in mining taxes, or less than 1 percent. Ad campaigns are encouraging voters to remove these tax protections and establish a reasonable tax on mineral production to help provide funding for education, training, research and more importantly waste cleanup.

 

Nevada is the top gold producer in the United States and one of the top five gold producers in the world. According to the Las Vegas Review Journal, mining corporations account for 98 percent of toxic chemicals released in Nevada, and a single gold ring leaves in its wake an average of 20 tons of mine waste.

 

While mining companies do pay a tax, it pales in comparison to what other industries pay. For example, the gaming industry pays a 6.6 percent tax rate which led to $694 million paid to the state in taxes in 2012. Even the average worker in Clark County pays a sales tax rate of 8.1 percent, eight times what mining companies pay in taxes.

 

Though the proposal has been met with hostility from some mining companies and lobbyists, the overall consensus is that mining companies should at least pay what they pay in other states. The argument that miners would abandon Nevada if taxed accordingly is unfounded since according to the Fraser Institute, Nevada is one of the most stable, mineral-rich, least-taxed places to mine in the world. Leaving behind a proven gold reserve would be foolish simply because of a practical tax rate.

 

In 2011, the Nevada State Legislature passed Senate Joint Resolution 15, which has become the first step in removing mining's loopholes from the state constitution.