Business

Hotel room tax plan raising questions

Thursday, May 22, 2008 12:11 AM CDT

CARSON CITY, Nev. (AP) - Voters may be asked in November whether they want the 2009 Legislature to increase hotel room taxes to ease the state's budget woes and help schools, but major casino companies remain divided about the proposal.

The state teachers union agreed not to push a ballot initiative seeking voter approval to raise taxes of big casinos from 6.75 percent to 9.75 percent in exchange for three major casino companies' support for raising the room tax.

Wynn Resorts, Harrah's Entertainment and Station Casinos supported the deal, brokered with the help of Assembly Speaker Barbara Buckley, but chief executives of MGM Mirage and Boyd Gaming Corp. don't like the idea.

Also expressing skepticism were Republican Gov. Jim Gibbons and Senate Majority Leader Bill Raggio, R-Reno, although both said they would consider a room tax increase up to 13 percent if voters favored it. Room taxes vary by jurisdiction. The rate is 9 percent on the Las Vegas Strip and 10 percent in downtown Las Vegas.