Nevada's Business-Friendly Tax Structures Attract Domestic and International Investment
Solar energy, agricultural products, and software development lead the state's industry growth.
Mali R. Schantz-Feld (Oct/Nov 08)
Michael Skaggs, executive director of the Nevada Commission on Economic Development (NCED), says he and other NCED staffers "came here because of the opportunity in the state of Nevada right now. It's one of those perfect storms - the citizens, the governor and lieutenant governor all understand the opportunity that's available to us, and we are ready to capitalize on it."
Because of Nevada's already large and increasing energy demands, energy alternatives spark much interest. According to Hatice Gecol, Ph.D., the governor's energy advisor, Nevada imports around $2 billion worth of electricity, and in total, the state imports around $11.3 billion worth of energy including oil, coal, electricity, and natural gas. With so much as stake, Nevada is poised "to build a substantial research/development manufacturing base around solar geothermal energies," says Skaggs. "We are one of the better weather-related states for solar opportunities, and our geothermal resources are considerable - we just optioned 100,000 acres for geothermal development."
International trade is another growth area. "We have enjoyed a 10 percent gain in exports over last year, which is pretty phenomenal considering the sluggish economy," says Skaggs, who notes that while exports of precious metals, such as gold and silver, garnered $2.86 billion in 2007, "we've also had quite a bit of success exporting agricultural products, such as alfalfa pellets for small animal feed to China." American Pet Diner, a specialty gourmet alfalfa and timothy hay business founded in a garage in Eureka, has progressed from shipping small boxed orders overseas to shipping full containers to Japan and South Korea. Sales have reached $1 million per year, half of which is exports. State exports of food and agriculture products in 2007 were $55.2 million, a 56 percent increase over 2006, and exports of food and agricultural products were up an additional 19 percent for the first half of this year over 2007.
Related to the state's gaming fame, Skaggs says, "We are involved with research and development and manufacturing related to the production of gaming devices and software. There is a giant spike in gaming particularly in Asia, and we are shipping to a lot of those markets." Besides exporting, the state also encourages foreign investors to explore sites within the state. "
The state strives for consistency in incentives. "Personal and corporate income tax is prohibited by our state constitution," says Skaggs. "We do work to utilize certain incentives to help companies transition, but our incentives don't just come and go; they are constitutional." The state offers sales and use tax abatements on eligible machinery and equipment, a sales-and-use tax deferral, a modified business tax abatement, personal property tax abatement, and work force training grants.