Guinn nixes idea of tax on services

Just minutes after he was sworn in for a second four-year term Monday, Gov. Kenny Guinn rejected the idea of a tax on services to balance the state budget.

Business people-- primarily retailers -- have suggested expanding the sales tax to include services provided by auto and other repair shops, lawyers and doctors to raise revenue.

"If they think this governor is going to pass on a direct tax to our people, like a sales tax, they've got another think coming when they get to the legislative session," said Guinn to reporters after his inauguration.

Guinn was sworn in along with the other constitutional officers in a brief ceremony in front of the Capitol. Lt. Gov. Lorraine Hunt, Secretary of State Dean Heller, Treasurer Brian Krolicki and Controller Kathy Augustine were also given the oath for second terms.

Attorney General Brian Sandoval took his first oath for that office, replacing Frankie Sue Del Papa, who retired after three terms.

All five are Republicans.

Guinn said he would have more specifics later this week on where the budget is headed. The proposed state spending plan is nearing completion and will be announced Jan. 21 in his State of the State speech.

Guinn said last month the shortfall will be about $800 million over the next two years. But he said some federal formula changes in Medicaid may reduce that total.

However, he said, that estimate also doesn't include increases he hopes to propose in areas such as the Nevada Check Up program, which provides health benefits for children of workers who can't afford to cover them; and possibly the Senior Rx program.

Guinn has refused to give details on how he intends to raise the necessary revenue. But he's made it clear there are some things he doesn't support -- including expanding the sales tax to include services.

He said the proposal by the state's chambers of commerce to simply increase existing tax levies isn't an option.

"Their program is not going to work, and they know it," he said. "It raises what, $364 million, and it's just doing the same thing we are now."

Guinn has said he is relying most heavily on recommendations by the Governor's Task Force on Tax Policy, which presented him with proposals in November designed to cover the estimated shortfall.

The heart of that group's recommendations is a new tax on gross business receipts that would raise at least $250 million a year.

It would increase "sin taxes" on alcohol and liquor as well as a variety of other levies imposed by the Secretary of State's Office and other state agencies.

Businesspeople have said they strongly oppose the business tax and plan to try block it in the Legislature.

Chief Justice Deborah Agosti administered the oaths in a ceremony attended by about 450 people.

A second swearing-in was scheduled later Monday at the state Supreme Court for Justice Bill Maupin, who won a second term; and for Mark Gibbons, a Clark County District Court judge who was elected without opposition to the high court.

Following Guinn's swearing-in, several hundred people attended a private, buffet-style reception at the Governor's Mansion. But unlike four years ago, there was no public reception.

Inaugural balls aren't scheduled this year because of the sluggish economy.

The Associated Press contributed to this story.