NEVADA VIEWS: Higher taxes won’t help Nevada diversify

As a labor and employment law attorney, I deal every day with small businesses as they continue to struggle to recover from the government-forced shutdowns. Today, even though the lockdowns — I hope — are behind us, inflation and labor shortages continue to plague small business in our state. Just recently, I heard of two restaurants that are closing due to the current economic conditions.

With an economy heavily based on tourism, a sector that was decimated for most of 2020 and into 2021, Nevada’s government and business leaders agreed that we need to diversify.

Manufacturing and logistics are industry sectors the state has identified to help do just that. These industries all benefited from the Tax Cuts and Jobs Act of 2017. That one bill was like rocket fuel for the manufacturing sector that has been expanding across the United States like never before.

In 2018 alone, manufacturers created 263,000 jobs — the best year for job creation in two decades. Manufacturers were also able to increase wages and benefits and invest in their communities.

Sadly, it appears that there are some in Congress who want to revoke these tax cuts that are critical to job creation. There are pending proposals to increase the corporate income tax rate to 28 percent, eliminate expensing of most depreciable assets and eliminate the 20 percent deduction for certain pass-through business income.

In a 2017 study by the National Association of Employers, manufacturing jobs in Nevada saw double-digit wage growth since the 2010 recession.

Clark County saw almost a doubling of logistics jobs from 38,922 in 2010, to 65,061 in 2020. Manufacturing grew from 20,428 in 2010 to 26,140 in 2020, with an average pay of $72,881 a year, according to the Governor’s Office of Economic Development.

The growth in Clark County is eclipsed by counties that have made manufacturing a priority, such as Storey County, home to the Tahoe-Reno Industrial Center. It went from 499 manufacturing jobs in 2010, to 11,792 in 2020, a 2,262 percent increase. This shows the potential for the rest of the state. In Clark County right now, there are more than 1,000 job openings in manufacturing that pay well more than $20 an hour.

Nevada is still on the road to recovery, and manufacturing is a critical sector that is needed to diversify our economy and protect us from an economic downturn.

I urge our congressional delegation and Sen. Catherine Cortez Masto to maintain the 2017 tax act that is helping to diversify our Nevada economy and recover from the hardships caused by the lockdowns in our state.

Brett Sutton is a partner with Sutton Hague Law Corporation. He counsels clients on labor and employment law matters and other business-related legal issues.