GOP leader Bill Raggio signals tax increase on the horizon

By Anjeanette Damon

Tuesday, Aug. 10, 2010 | 2:10 p.m.

In a brief interview today, Senate Minority Leader Bill Raggio, R-Reno, said the state’s budget crisis is so great that a tax increase and an extension of the temporary 2009 tax increase may be necessary to keep government afloat.

Raggio’s comments came amid a growing chorus of state officials saying the reality of Nevada’s looming $3 billion shortfall will necessitate a tax increase.

“I do think we will have to have some infusion of new revenue,” Raggio said today. “But first, we must determine the essential services at the state level.”

Raggio also said lawmakers will have to consider lifting the sunset on the 2009 tax increase, which could take care of nearly a third of the budget hole. Raggio, whose vote was critical to passing the 2009 tax increase, insisted that the tax hike be temporary.

Last week, Senate Majority Leader Steven Horsford, D-North Las Vegas, said a $1.5 billion tax increase and $1.5 billion in spending cuts would be needed in 2011.

On Friday, state budget director Andrew Clinger agreed a tax increase would be needed to balance the state budget, but has since backed off those comments. He now says the budget could be balanced if state lawmakers looked to local governments for revenue and new services.

Meanwhile, both gubernatorial candidates continue to vow not to raise taxes during the state’s worst recession since the Great Depression.

Mary-Sarah Kinner, spokeswoman for Republican Brian Sandoval, said Saturday that Sandoval would veto any budget that came with a tax increase.

Democrat Rory Reid said he refuses to speculate on what he would do in such a scenario, but repeated his promise not to raise taxes.