Tax & Accounting Blog

Constitutional Sales Tax Exemption Sought in Nevada

Blog, Indirect Tax, ONESOURCE, Sales and Use Tax June 24, 2016

The backers of a Nevada ballot initiative hope to exempt medical equipment from sales and use tax by way of a constitutional amendment. The Medical Patient Tax Relief Act would amend Article 10 of the Nevada constitution by adding a section that reads:

The legislature shall provide by law for the exemption of durable medical equipment, oxygen delivery equipment and mobility enhancing equipment prescribed for human use by a licensed provider of health care acting within his or her scope of practice from any tax upon the sale, storage, use or consumption of tangible personal property.

While legislative exemptions from sales tax are widespread, it’s less common for them to arise via ballot initiative, and even less so for them to take the form of a constitutional amendment. According to initiative backer Doug Bennett, previous attempts to exempt medical equipment through the legislative process have been unsuccessful. Doug Bennett is an officer with the political action committee known as the Alliance to Stop Taxes on the Sick and Dying, which is funded mainly by Bennett’s medical device company, Bennett Medical Services.

In Nevada, “initiated” constitutional amendments such as this must be approved in two consecutive elections. So even if it’s approved in November, the Medical Patient Tax Relief Act would have to be approved again in 2018 before becoming law. However, most Nevada amendments that pass the first election succeed in the second as well.