I-Team: State suffers multi-million dollar tax mistake - 8 News NOW

I-Team: State suffers multi-million dollar tax mistake

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LAS VEGAS -- State economic experts say Nevada is short $70 million.

They say they made the multi-million dollar mistake while figuring out how much the state would be getting from mining taxes.

Just like when you do your income taxes and take business deductions, Nevada mining companies do the same.

However, when mining companies took tens of millions in deductions, it left the state wondering where their tax dollars went.

Mining companies pay what is called a net proceeds tax on minerals, usually gold, they take out of the ground. That is in addition to payroll, property and sales taxes they pay.

Mining companies say with the price of gold going down, the amount they pay in taxes also goes down. But experts on the state's Economic Forum are concerned that mining companies are keeping them in the dark about the amount of taxes they expect to pay.

"I would love to see how they build these forecasts, because the costs the mining companies deduct are continuing to go up regardless of revenues," vice-chairman of the Economic Forum Matt Maddox said.

The problem, according to the Nevada Economic Forum, is that state law forces them to guess what mining companies will pay in taxes a year in advance. This year, they guessed mining companies would pay $93 million. Instead, the state is getting $20 million.

That budget hole could have a major impact on Nevada's rural counties and state programs. State economic experts asked for the Legislature to re-write the laws for mining companies to come up with more frequent tax estimates.

The state hopes that will avoid multi-million dollar counting errors. It is up to state lawmakers to see what to cut in the budget to fill that $70 million gap.

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