North Las Vegas senator proposes employer tax credit to help pay for child care
CARSON CITY — Nevada employers who help workers find or pay for child care would receive a break on payroll taxes under a bill considered Thursday by a Senate committee.
Senate Bill 147, sponsored by Sen. Patricia Spearman, D-North Las Vegas, entitles an employer to an annual tax credit on modified business taxes of 50 percent of assistance provided, to a maximum of $2,500 per employee, per year.
“It’s not just about family values, it’s about valuing families,” Spearman said.
Businesses whose credits exceed taxes owed could carry over credits for five years.
Spearman said the cost of child care can range from $6,000 to $10,000 a year.
“The benefits are not just to the employee, but the employer gets something, too, because you have a more stable workforce,’ Spearman said in presenting the bill to the Senate Committee on Revenue and Economic Development.
She offered an amendment to impose a financial needs test for employees to qualify.
But state Sen. Ben Kieckhefer, R-Reno, questioned how a business would determine need, especially in two-income households.
“I liked it without the means test,” he said. “It was clean and easy to administer.”
Senate Minority Leader Michael Roberson questioned the cost to the state budget. The tax generated $566 million in fiscal year 2016.
Spearman said the cost is difficult to calculate because it’s unknown how many employers would participate or how many employees would qualify if a means test is included.
“I like the concept. I like the idea behind the bill. But I think we have to know somewhat close to the ballpark” how it’s going to impact revenues, Roberson said.
No one testified against the bill, though the Retail Association of Nevada and Nevada Manufacturers Association raised concerns.
Bryan Wachter with the retail group suggested the state consider something like health savings accounts that could be used for child care expenses.
Ray Bacon with the manufacturers association said employers like the modified business tax for its predictability and simplicity.
“To start playing around with that … causes our members concern,” he said.
No action was taken by the committee and Spearman said she was willing to work on a compromise.
Contact Sandra Chereb at schereb@reviewjournal.com or 775-461-3821. Follow @SandraChereb on Twitter.
