A plan to raise $932 million for education and social services was presented by the Progressive Leadership Alliance of Nevada on Wednesday.
The group said it will present its solution to Nevada's budget shortfall and growth needs -- which was two years in the making -- at an upcoming meeting of the Governor's Task Force on Tax Policy.
"The needs are there," said Plan Director Bob Fulkerson. "We need to raise $750 million to reach a level of decency."
Two pieces of the plan are increases in existing taxes on cigarettes and liquor, which the Alliance's Jan Gilbert said haven't gone up in more than a decade.
But the two major pieces are new taxes aimed at the top 1 percent of Nevada's wealthiest citizens, she said.
The plan calls for a 5 percent business profits tax similar to the 4 percent levy proposed by the teachers union two years ago but without the constitutional defect earmarking half the state budget for education, which killed the earlier proposal.
Alliance member Paul Brown said there is no earmarking in the new proposal.
"The business profits tax will raise $341 million a year with more than half of that coming from out of state sources," Gilbert said.
She said Nevada is one of just four states with no tax on business income.
"In Nevada we give our corporations a free ride and taxpayers like you and me end up subsidizing companies like Wal-Mart," Fulkerson said.
Gilbert said small businesses making less than $50,000 a year in net profits would be exempted from paying the tax.
The biggest piece of the proposal is the investment tax which would generate an estimated $546 million a year from the wealthiest Nevadans. They would be required to submit tax returns to the state and pay 6.8 percent on incomes of more than $100,000 a year.
"Mostly the top 1 percent will pay this tax," Gilbert said.
Fulkerson said the way those two taxes are structured, they wouldn't hit the low- and middle-income Nevadan.
The proposal would also increase the cigarette tax by $2 per carton. Alliance officials said Nevada's total cigarette tax would still be below California's. And the plan would bump state taxes on beer, wine and liquor by 50 percent making the state tax 2.5 cents on a six-pack of beer.
The cigarette tax hike would generate an estimated $34 million a year and the liquor tax another $11 million.
Fulkerson said the money is needed to fund education and social services where Nevada ranks among the nation's worst in services. But he said the proposal doesn't earmark the money. He said lawmakers and the governor's office have long agreed those areas are where the money is needed.
"They've been saying there's no money," Gilbert said. "Well, we're trying to show them where to get it."
