Multistate Tax Alert: Nevada Supreme Court Upholds Margin Tax Initiative
In a unanimous opinion issued on January 31, 2013, the Nevada Supreme Court reversed an earlier Carson City District Court decision that had ruled invalid an initiative petition that seeks to amend the Nevada Revenue and Taxation Code to add a new state-level margin tax. By overruling the lower court, the Supreme Court’s decision upholds the initiative, thus sending the matter to the Nevada Legislature for further consideration. If legislators reject the initiative or fail to act, it would go before voters in 2014. Liability for the tax would begin to accrue on January 1, 2014, if the initiative is approved by the Legislature; or on January 1, 2015, if approved by voters.
In the attached Tax Alert we describe the proposed Nevada Margin Tax, outline Nevada’s initiative process, review the lower court rulings, and summarize the Nevada Supreme Court’s decision.