Sandoval removes tax department director after failure to audit mining companies

By Anjeanette Damon

Friday, March 11, 2011 | 1:06 p.m.

In a swift move following an uncomfortable exchange with lawmakers over the state’s inability to audit the mining industry’s tax deductions, Gov. Brian Sandoval removed his director of taxation today.

In a written statement, Sandoval said director Dino DiCianno is retiring effective immediately. Deputy director Chris Nielsen will act as interim director.

The announcement comes less than a day after DiCianno admitted to lawmakers that he has had no one trained to audit the mining industry’s net proceeds tax returns for at least two years. DiCianno also said he didn’t inform Sandoval of the staffing problem during the budgeting process.

Stunned lawmakers sat nearly speechless at the surprise admission during Thursday’s hearing before the Senate Revenue Committee.

“I am going to have to start taking blood pressure medication,” Senate Majority Leader Steven Horsford said.

Sandoval has ordered Nielsen to prepare a plan to immediately resume auditing the mining companies to ensure they are properly claiming deductions from the net proceeds tax.

According to tax department figures, mining companies are projected to claim $4.2 billion worth of deductions this fiscal year, as the industry enjoys record gold prices.

Lawmakers said they are coming under increased pressure from constituents to turn to the booming industry for more tax revenue as the state works to close a $2.2 billion budget hole.