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The Nevada Independent

Quartet of business groups join GOP suit to overturn extension of payroll tax rate

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Front of the Nevada Legislature building

Four Nevada business organizations on Tuesday joined a lawsuit recently mounted by Senate Republicans that challenges the constitutionality of a Democratic-backed measure that would remove a scheduled decrease in the state's payroll tax rate.

The organizations — the Retail Association of Nevada, Nevada Trucking Association, Nevada Franchised Auto Dealers Association and the National Federation of Independent Businesses — announced in a release that they are joining the suit because "forcing through these [tax] extensions without a two-thirds majority vote in each house sets a dangerous precedent."

The associations asserted that they believe the potential consequences of allowing SB551 , which extends the payroll tax rate, and another less high-profile bill, SB 542, which extends a DMV fee, to pass without a  two-thirds vote could "subject many more Nevadans to the commerce tax or raise property taxes and many other fees all on a simple majority vote".

Bryan Watcher, senior vice president of the Retail Association of Nevada, said that "it raises further questions of whether the motivation behind these votes was increasing revenue or an attempt to erode the voter-mandated two-thirds requirement."

Senate Republicans have urged the court to reach a decision before Oct. 1, the day businesses will have to pay the first round of taxes in the bill, so the state will not be forced to issue taxpayer refunds.

Representatives for the companies on the lawsuit have testified several times before the Legislature during the session and have "urged lawmakers to err on the side of caution when it comes to voters' intent." Each organization is confident that a judicial ruling will uphold the requirement of a two-thirds majority vote for any piece of tax legislation.

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