George Flint, lobbyist for Nevada's legal brothels, says including them under the proposed live entertainment tax will change the way brothels do business.
He said they will set up new operating rules to impose and collect the tax from customers, including an admission charge for customers to enter the bedroom area of the brothel.
But he said the biggest difference will be to help establish brothels as businesses.
"This is going to give us a legitimacy we've never enjoyed," he said.
"As long as we behave ourselves and we contribute $4-$6 million to the general fund, it's going to be a cold day before some crank gets us outlawed."
Flint represents 9 major brothels and "18 or 19 mom and pops."
Supporters of the proposed 10 percent tax on all live entertainment tax have pushed throughout the session to make sure strip clubs and brothels don't escape taxation. Flint said they welcome the tax.
He said the way they envision the tax working is that brothels will pay the entertainment tax on all beverages and novelty items such as T-shirts -- as well as existing sales taxes on those items.
"We'll raise drink prices 50 cents and T-shirts and other novelties a buck," he said.
The key charge will be for those customers who want to go beyond the bar area back to the bedrooms. Flint said smaller brothels will probably charge those customers $20 as an admission fee, larger establishments $40. Those fees are taxable under the plan in both the Senate and Assembly versions of the entertainment tax.
With more than 600,000 customers a year, he estimated that fee would generate more than $2 million a year for the state.
"When you add in the souvenirs and the tax on drinks at the bar, I estimate they would be contributing $4-$5 million a year," said Flint.
"The implication of the tax and our willingness to be part of it is an insurance policy we've never enjoyed," he said.
Brothels have always been legal or tolerated in different parts of Nevada. The houses were banned at the start of World War II in the Reno and Las Vegas areas under pressure from the U.S. military which threatened to make those towns off limits to servicemen at Stead and Nellis -- then two large pilot training facilities.
But there were generally no laws either banning or allowing brothels in the other counties until the 1970s when Storey, Churchill and several other counties legalized and taxed their brothels.
There are still more than 30 operating brothels in the state -- four of them along Highway 50 east of Carson City in Mound House and at least one new facility under construction in Storey County east of Reno by entrepreneur Lance Gillman.
