Nevada Gov. Jim Gibbons formally announced yesterday that he plans to veto the $781 million tax increase bill lawmakers passed Friday. Lawmakers are expected to override the veto promptly. The veto was scheduled for yesterday evening.

The bill will raise $781 million through temporary two-year increases in business license fees, as well as in state sales, payroll, and vehicle registration taxes.

Nevada’s economy has been hammered by the recession. Its housing sector has been walloped by high foreclosure rates and even the casino gambling industry is seeing a downturn, resulting in a major hit to the state government’s revenue.

That has led to cuts to most state programs. The Democratic majorities in the Legislature approved the tax increases to reduce the severity of the cuts, despite the Republican governor’s stated opposition to any tax increases.

The two-year sunset provision for the taxes was introduced to acquire the GOP votes needed to secure a veto-proof majority in the state Senate. The bill ultimately passed the Senate 17 to 4 and the Assembly 29 to 13.

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