Tomorrow is April 15, also known as Tax Day 💸 If you haven’t filed yet, get crackin’ on whatever you have to do with those W2 or 1099 forms. At least there’s no income tax to worry about in Nevada.
⛏️ Did Nevada Ever Have an Income Tax?
Nope. Nevada became a state just days before the 1864 election — a rush job to provide Abraham Lincoln with three extra electoral votes to help secure the president’s reelection. (This happened during the Civil War, which is why we’re called the “Battle Born State.”) An early draft of the Nevada Constitution included a tax on mining revenue, but even that was too much and the wording was revised to be a tax on profit.
🤑 What Makes Up for a Lack of Income Tax?
Well, you may have noticed your annual car registration fees are a lot higher than in some other states. The legalization of gambling in the 1930s was a financial windfall for Nevada and the gaming tax continues to generate more than a third of the state’s revenue. There is also a sales tax, which is more than 8% in Clark County, and property taxes, which are relatively small compared to elsewhere. The 9% live entertainment tax is especially important in Nevada, since it applies to the concerts, shows, sports and other events that drive the Vegas economy.
💼 What About a Corporate Tax?
Nevada doesn’t have that either, which combined with an extremely low modified business tax rate makes us one of the most business-friendly states in the country. Nevada is a sharp contrast to neighboring California, which has one of the highest corporate tax rates in the country (nearly 9%) on top of the highest marginal state income tax rate (more than 14%).
🧮 So What Do We Spend Our Taxes On Anyway?
Healthcare and education eat up more of the state’s $40 billion biennial budget than anything else, followed by the Department of Transportation in a distant third place.
🤔 How’s It Working Out?
Nevada has seen years with both surpluses and deficits, thanks to our dependence on gambling and tourism spending, which can fluctuate. As a purple state with a Libertarian streak, politicians routinely find success promising not to raise taxes — and that’s probably not changing anytime soon.
