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Senate Economic Growth Plan for Nevada

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Economic Growth Plan for Nevada
Press Release February 8th, 2010 Diversifying Nevadas Industry A key to job creation in Nevada is diversifying our economic industries. While the gaming industry is Nevadas greatest producer of jobs and revenue, the recent economic crisis has had a dramatic impact on the industry. We need to diversify Nevadas economy to create multiple industries and help create a broader job market and financial structure within the state. We can start doing this by implementing several other key proposals: 1. Yucca Mountain Nevada has a unique opportunity within its grasp to take the lead in the U.S. on the nuclear power front. While I fully oppose utilizing Yucca Mountain as a nuclear spent fuel dump for the rest of the country, we can certainly make use of the work already started there by transforming it into a nuclear spent fuel reprocessing plant. Reprocessing plants have been utilized all around the world and have excellent safety track records. Yet I find it bizarre that, as one of the leading nuclear energy producers in the world, the U.S. does not have a single reprocessing site. The location is ideal and the transition process could be started easily , the result being a new industry that Nevada can take a lead in. Turning Yucca Mountain into a nuclear reprocessing facility will create thousands of jobs for Nevadans, generate hundreds of millions of dollars of much needed revenue for the State, and turn UNLV and Nevada into the leading research institutions in this field in the world. 2. Reduce Corporate Income Tax Rates Our corporate income tax rates are some of the highest of any country in the world. We need to reduce these rates or eliminate them entirely to allow more flexibility for businesses to generate revenue and increase employment. 3. Reduce Sales Tax in Nevada Nevada ranks as the seventh worst state in the country when it comes to sales tax rates with a state tax of 6.85% and county modifications that can drive it as high as 8.1%. Over 70% of the U.S. economy is driven by consumer spending. When consumers spend more, businesses will produce more goods and services to satisfy heightened demand. To accommodate the increase in production, businesses will hire additional workers, thereby reducing the unemployment rate. Within the context of our current tax structure, when consumption taxes, like sales tax, are decreased consumer spending will increase. Cutting sales tax rates will boost consumer spending creating new jobs and new revenue for the state. We can off-set the cost of these cuts at the federal level by using money saved by the elimination of pork barrel spending available as a supplement for any state willing to offer at least
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Danny Tarkanian for U.S. Senate Economic Growth Plan for Nevada

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a 50% sales tax reduction. 4. Make Public Land Easily Available for Development Nevada is 85% federally owned land. A portion of that land exists in locations unsuitable for any other use other than commercial development, like a piece of BLM land in Douglas County that lies between a Costco and a church. There are hundreds of acres of land owned by the BLM on the Las Vegas Strip, the most valuable piece of commercial real estate in Nevada. We need to transfer ownership of federal land thats only applicable use is for commercial development back to the State. Nevada can use this resource to attract new and diverse businesses. Making use of this land will have no cost to the taxpayer and will serve as a revenue generator. 5. Pass a Two Year Moratorium on the Nevada Jobs Tax Since its conception in 1991 and final passage in 1993, the Nevada Jobs tax has been a job creation determent. At the time of its consideration many small business owners testified that it would likely hinder their inclination to hire employees and it has done just that. At a time of record high unemployment we need to cut taxes to encourage businesses to hire employees, not penalize them for it. Although I am running for a federal office and this is a state issue, I encourage the legislature and governor to pass a two-year moratorium on this job killing tax. Reducing Taxes Our taxes in this country are simply too high and because of that I was honored to sign the Taxpayer Protection Pledge issued by the Americans for Tax Reform. The United States tax code is one of the most complex in the world and is incredibly biased against saving and investment. Real tax code reform is needed and that means transitioning from the current form to a new system, like the fair tax system that is currently being proposed in both the House and the Senate. A repeal of all income taxes and an institution of a straight fair tax would relieve the tax burden on businesses and help open the door for growth and job creation, while also allowing the taxpayer to responsibly spend their money how they see fit. This tax system has received bipartisan support and stands as a plausible alternative to the current tax code. However, the current tax structure that is in place is dependent upon consumer spending and as such requires consumption to thrive. Under this structure, the key to economic growth is cutting sales tax rates to incentivize consumer spending. At the same time there are several other significant tax reforms that should take place in lieu of a complete overhaul of the tax code to help give money back to taxpayer to pay down debt and save: 1. Repeal the Death Tax The so-called inheritance or estate tax is inefficient, unfair and unconstitutional and that is why I signed the American Family Business Institutes pledge to repeal the death tax. It is a poison to family business and placed a wasteful burden on small businesses. The Death Tax was repealed in 2001 but will go back into full effect next year at staggering levels if no action is taken. The Death Tax repeal must be extended or made permanent so that American families can avoid being taxed twice for the same income. 2. Repeal the Capital Gains Tax/ Inflation Indexing Set to revert back to its 2003 levels at the end of 2010, we need to work to ensure that capital gains taxes are kept at a reduced level or repealed. If neither of these options is achievable, then at a minimum we must ensure that the Capital Gains tax is indexed for inflation to help taxpayers avoid getting taxed on money they didnt actually receive. 3. Lower Income Taxes Yet another of the 2001/2003 Bush tax cuts set to sunset at the end of this year, the income tax rates will explode if action is not taken to make the cuts permanent. Even at the current rates our income taxes are far too high and I am committed keeping them from getting any higher and in the long term lowering them. We need to pass reforms that will rollback tax rates to Reagan era levels. Addressing the Housing Market Fixing the Nevada housing market is a difficult task. Nevada currently ranks as worst in the country in the rate of foreclosures and while the economy continues to struggle that wont change. While no silver bullet currently exists for this
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Danny Tarkanian for U.S. Senate Economic Growth Plan for Nevada

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problem, there are a few proposals that can help keep homeowners who havent defaulted from staying that way: 1. Streamline Mortgage Refinancing Many Nevada homeowners who are in good standing on their loans are trapped in mortgages with high interest rates, some as high as 8% to 9%. We can help these homeowners save much needed money by allowing them to streamline their refinancing to current, lower interest rates, currently at 4.75%. This option is already available to most homeowners with government-backed mortgages, and streamline refinancing should be extended to those with privately issued mortgages. 2. Expanding the First Time Homebuyer Credit The federal government has been offering a first time home buyer tax credit in an attempt to help revive the struggling housing market. This tax credit should be extended to any and all qualified potential homeowners looking to purchase a primary residence in states with high foreclosure rates. This is a simple expansion of a tax credit already in place that could provide some assistance in improving the housing market in Nevada. Cutting Federal Spending Current federal spending levels are through the roof and the result is a national debt that sits at over $12 trillion with congress recently passing a bill to allow that to grow past $13 trillion. However, the Democrat- run congress led by Sen. Reid continues to pump out new programs like the latest healthcare plan, requiring even more spending. Expanding the role of the federal government and increasing federal spending is the last thing this country needs right now. We need to be looking at ways to cut spending to reduce the national debt, pay for the tax cuts needed in the country, and give the taxpayers money back to them. There are several places we can do this: 1. Balance the Budget First and foremost, passing a balanced budget amendment is absolutely necessary to help control a congress that has gone on an unchecked spending spree. Enacting legislation like the H.J. Res. 1, the Balanced Budget Act, will help bring responsibility back to congress and the federal government. 2. Enact the CARFA Act The Commission on Accountability and Review of Federal Agencies (CARFA) Act would create a review of all federal agencies much the same way the Base Closing and Realignment Commission (BRAC) reviews military bases. The difference being that BRAC recommends what bases to close, CARFA recommends what agencies and programs to shut down. This is a sensible approach to reviewing and cutting unnecessary federal government spending. 3. Entitlement Spending Of the estimated $1.06 trillion spent on Medicare, Medicaid and SCHIP alone, nearly 10% is estimated lost to waste, fraud and abuse. That is close to $100 billion a year lost. Wasteful spending is not unique to our healthcare programs, we need to thoroughly review all federal entitlement spending and find proactive approaches to stopping this kind of waste. Until this is done, expanding these programs would be irresponsible. 4. Cut Pork Barrel Spending The most egregious abuse of federal spending in existence right now is the excessive amounts of pork barrel spending or earmarks. Over the past 4 years there has been an estimated $48 billion spent on pork barrel projects through the earmark process, and this isnt even counting the pork barrel projects that have riddled the stimulus funding in the Recovery Act. This is not what the federal government was intended to do. Elimination of earmark spending is absolutely necessary to help cut federal spending and void the process that would have Nevadans paying for a bridge that turtles can use to cross the freeway in Florida. That is why I proudly pledged to participate in the effort to ban all earmarks. 5. TARP Funds Banks are starting to pay back the TARP funding they received, and soon all $700 billion will be returned. President Obama is looking at this as new revenue to be spent on other projects and I find that absolutely unacceptable. 6. Stimulus Fund Over $789 billion was designated as stimulus funding. Of that total the federal tracking website tells us that $263 billion has already been paid out. Some was spent for tax benefits, some to the states to help with
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Danny Tarkanian for U.S. Senate Economic Growth Plan for Nevada

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unemployment benefits and healthcare coverage, and the rest in pork barrel projects. The simple fact is that the stimulus has been incredibly fruitless in its existence, so much so that before all of the funding is even spent, there is talk of a new stimulus. Enough is enough! We should use the leftover stimulus funds to pay for much needed tax cuts, giving the money back to the taxpayer. 7. Privatize Fanny Mae and Freddie Mac last year alone congress spent over $28 billion on Fannie Mae and Freddie Mac encouraging them to insure high-risk mortgages that were simply not commercially viable. Now both entities are government run. There is a private market already in place for mortgage insurance and using the federal government as a market competitor is only doing more harm than good at a tremendous cost to the taxpayer. The effects these two had on the financial sector have been devastating and its time we either shut them down or completely withdraw any government ownership and assistance. 8. Department of Education This is probably one of the most over-funded, un-necessary aspects of the federal government. The increasing expansion has served to do far more harm than good. The results have been an alarming migration of policy decisions out of the local school boards and state education departments into the grasp of the federal government. We need to begin reducing the role of the federal government in our education system and limiting the department of education to the few programs that have proved successful, like Head Start and college scholarships. By reducing the department of education the annual savings could be as high as $5 billion.

Proposed Federal Agency Budget Cuts

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Danny Tarkanian for U.S. Senate Economic Growth Plan for Nevada

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