SB431 - Revises provisions relating to the excise tax on live entertainment. (BDR 32-692)

REQUIRES TWO-THIRDS MAJORITY VOTE (§ 13) EXEMPT (Reprinted with amendments adopted on May 29, 2025) SECOND REPRINT S.B. 431 - *SB431_R2* SENATE BILL NO. 431–COMMITTEE ON REVENUE AND ECONOMIC DEVELOPMENT MARCH 24, 2025 ____________ Referred to Committee on Revenue and Economic Development SUMMARY—Revises provisions relating to the excise tax on live entertainment. (BDR 32-692) FISCAL NOTE: Effect on Local Government: No. Effect on the State: Yes. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to taxation; imposing the excise tax on admission to live entertainment events through certain resales; requiring certain persons who facilitate resales of admission to live entertainment events to collect the excise tax on such resales; limiting the liability of such persons for failure to collect the tax under certain circumstances; authorizing the Department of Taxation to adopt regulations to require certain persons who list or advertise resales of admissions to live entertainment events to collect and remit the tax under certain circumstances; revising the distribution of the proceeds of the tax; making an appropriation; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing law provides for the imposition of an excise tax at a rate of 9 percent 1 of the admission charge on admission to certain facilities where live entertainment 2 is provided. Existing law additionally provides that such a tax must be collected 3 from the purchaser at the time of purchase, whether or not the admission is 4 purchased for resale. (NRS 368A.200) Section 13 of this bill requires the excise tax 5 imposed on admission to live entertainment events to also be imposed on each 6 resale of admission by a reseller, other than an occasional sale. Section 13 requires 7 a reseller to retain certain records and to provide a credit to a purchaser on the 8 amount of tax owed on the resale of an admission based on the amount of tax paid 9 by the reseller at the time of the initial purchase of the admission. 10 Section 7 of this bill requires a person who directly or indirectly facilitates 11 resales of admission to certain facilities where live entertainment is provided to 12 – 2 – - *SB431_R2* collect and remit the tax if, in the immediately preceding calendar year or the 13 current calendar year, the facilitator had more than $100,000 of gross receipts from 14 certain transactions or made or facilitated 200 or more sales transactions, on the 15 facilitator’s own behalf or on behalf of a reseller, unless the facilitator enters into an 16 agreement with a reseller whereby the reseller agrees to assume responsibility for 17 the collection and imposition of the tax. Section 8 of this bill provides that such a 18 facilitator is not liable for the payment of the tax under certain circumstances. 19 Section 9 of this bill authorizes the Department of Taxation to adopt 20 regulations requiring certain persons who receive a fee in exchange for listing or 21 advertising resales for a reseller of admission to certain facilities where live 22 entertainment is provided but who do not collect money or other consideration from 23 a customer to impose, collect and remit the tax if 200 or more sales transactions 24 result from referrals made by the person or the cumulative gross receipts of sales 25 resulting from such referrals exceed $100,000. 26 Existing law requires the excise tax imposed on admission to live entertainment 27 events, commonly referred to as the live entertainment tax, to be collected by the 28 Nevada Gaming Control Board or the Department, depending on whether the live 29 entertainment was provided at a licensed gaming establishment. (NRS 368A.110, 30 368A.140) Existing law requires the Board and the Department to deposit all taxes, 31 interest and penalties received from the live entertainment tax in the State Treasury 32 for credit to the State General Fund, except that, on or before October 1 of each 33 year, the Department is required to deposit $150,000 from the taxes, interest and 34 penalties it receives in the State Treasury for credit to the Nevada Arts Council as a 35 continuing appropriation. (NRS 368A.220) Sections 13.5 and 13.9 of this bill 36 require that 1/36 of all taxes, interest and penalties received from the live 37 entertainment tax for a taxable period beginning on or after January 1, 2026, after 38 subtracting the amount of the distribution to the Nevada Arts Council, must be 39 distributed to the regional transportation commission in a county whose population 40 is 700,000 or more (currently only Clark County) for use for the operation and 41 maintenance of a public transit system. Sections 13.6, 13.9 and 14 of this bill 42 provide that if a certain ballot question for the imposition of a sales and use tax to 43 provide certain funding for that regional transportation commission is not submitted 44 or approved by the voters of such a county before January 1, 2029, the distribution 45 of the live entertainment tax to the regional transportation commission must 46 increase to one-ninth of all taxes, interest and penalties received from the live 47 entertainment tax for a taxable period beginning on or after July 1, 2029, after 48 subtracting the amount of the distribution to the Nevada Arts Council. 49 Section 13.8 of this bill makes an appropriation to the Department of Taxation 50 for certain expenses to implement the provisions of this bill. 51 Sections 2-6 and 12 of this bill define certain terms relevant to the tax on 52 admission to live entertainment events. Section 11 of this bill makes a conforming 53 change to make these definitions applicable to this tax. 54 THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. Chapter 368A of NRS is hereby amended by 1 adding thereto the provisions set forth as sections 2 to 10, inclusive, 2 of this act. 3 Sec. 2. “Affiliate” means a person who directly or indirectly 4 owns or controls, is owned or controlled by or is under common 5 ownership or control with another person. For the purposes of this 6 – 3 – - *SB431_R2* section, control shall be presumed to exist if any person directly or 1 indirectly owns, controls, holds with the power to vote or holds 2 proxies representing 10 percent or more of the voting securities of 3 any other person. This presumption may be rebutted by a showing 4 that control does not exist in fact. 5 Sec. 3. 1. “Marketplace facilitator” means a person, 6 including any affiliate of the person, who: 7 (a) Directly or indirectly does one or more of the following to 8 facilitate the resale of admission to any facility in this State where 9 live entertainment is provided: 10 (1) Lists, makes available or advertises the resale of, by a 11 marketplace reseller in a marketplace owned, operated or 12 controlled by the person, admission to any facility in this State 13 where live entertainment is provided; 14 (2) Facilitates the resale of admission to any facility in this 15 State where live entertainment is provided when such resale is 16 facilitated by a marketplace reseller through a marketplace by 17 transmitting or otherwise communicating an offer or acceptance 18 of such a resale between a marketplace reseller and a purchaser in 19 a forum, including, without limitation, a shop, store, booth, 20 catalog, Internet website or similar forum; 21 (3) Owns, rents, licenses, makes available or operates any 22 electronic or physical infrastructure or any property, process, 23 method, copyright, trademark or patent that connects marketplace 24 resellers to purchasers for the purpose of making resales of 25 admission to any facility in this State where live entertainment is 26 provided; 27 (4) Provides a marketplace for making resales of admission 28 to any facility in this State where live entertainment is provided or 29 otherwise facilitates the resale of admission to any facility in this 30 State where live entertainment is provided, regardless of 31 ownership or control of the right or privilege of admission to the 32 facility in this State where live entertainment is provided that is the 33 subject of the resale; 34 (5) Provides software development or research and 35 development activities related to any activity described in this 36 subsection, if such software development or research and 37 development activities are directly related to the physical or 38 electronic marketplace provided by a marketplace provider; 39 (6) Provides or offers fulfillment or storage services for a 40 marketplace reseller; 41 (7) Sets prices for the resale by a marketplace reseller of 42 admission to any facility in this State where live entertainment is 43 provided; 44 – 4 – - *SB431_R2* (8) Provides or offers customer service to a marketplace 1 reseller or the customers of a marketplace reseller, or accepts or 2 assists with taking orders, returns or exchanges of admission to 3 any facility in this State where live entertainment is provided 4 which was resold by a marketplace reseller; or 5 (9) Brands or otherwise identifies resales as those of the 6 marketplace facilitator; and 7 (b) Directly or indirectly does one or more of the following to 8 facilitate a sale: 9 (1) Collects the sales price or purchase price of a resale of 10 admission to any facility in this State where live entertainment is 11 provided; 12 (2) Provides payment processing services for a resale of 13 admission to any facility in this State where live entertainment is 14 provided; 15 (3) Charges, collects or otherwise receives selling fees, 16 listing fees, referral fees, closing fees, fees for inserting or making 17 available the resale of admission to any facility in this State where 18 live entertainment is provided on a marketplace or other 19 consideration from the facilitation of a resale of admission to any 20 facility in this State where live entertainment is provided, 21 regardless of ownership or control of the right or privilege of 22 admission to the facility in this State where live entertainment is 23 provided that is the subject of the resale; 24 (4) Through terms and conditions, agreements or 25 arrangements with a third party, collects payment from a 26 purchaser in connection with a resale of admission to any facility 27 in this State where live entertainment is provided and transmits 28 that payment to the marketplace reseller, regardless of whether the 29 person collecting and transmitting such payment receives 30 compensation or other consideration in exchange for the service; 31 or 32 (5) Provides a virtual currency that purchasers are allowed 33 or required to use to purchase a resale of admission to any facility 34 in this State where live entertainment is provided. 35 2. The term does not include a person who provides Internet 36 advertising services, including, without limitation, the listing for 37 resale of admission to any facility in this State where live 38 entertainment is provided, if the person does not directly or 39 indirectly or through an affiliate: 40 (a) Transmit or otherwise communicate an offer or acceptance 41 between a marketplace reseller and a purchaser of a resale of 42 admission to any facility in this State where live entertainment is 43 provided; and 44 – 5 – - *SB431_R2* (b) Do one or more of the activities listed in paragraph (b) of 1 subsection 1. 2 Sec. 4. “Marketplace reseller” means a reseller who makes 3 resales of admission to any facility in this State where live 4 entertainment is provided, when such resale: 5 1. Is made through any physical or electronic marketplace 6 owned, operated or controlled by a marketplace facilitator, even if 7 the reseller would not have been required to collect and remit the 8 tax imposed by this chapter had the resale not been made through 9 such marketplace; or 10 2. Results from a referral by a referrer, even if the reseller 11 would not have been required to collect and remit the tax imposed 12 by this chapter had the resale not been made through such 13 referrer. 14 Sec. 5. “Resale” or “resell” means a transaction for the sale 15 of the admission to a facility in this State where live entertainment 16 is provided which occurs after the initial purchase of the 17 admission. The term includes, without limitation, a sale made in 18 person or by telephone, an Internet website or any other means of 19 communication or exchange. 20 Sec. 6. “Reseller” means any person who resells the 21 admission to a facility in this State where live entertainment is 22 provided. 23 Sec. 7. 1. Except as otherwise provided in this section and 24 section 8 of this act, the provisions of this chapter relating to the 25 imposition, collection and remittance of the tax imposed by NRS 26 368A.200 apply to a marketplace facilitator during a calendar year 27 in which or during a calendar year immediately following any 28 calendar year in which: 29 (a) The cumulative gross receipts from retail sales of tangible 30 personal property to customers in this State and the sale of 31 admission to any facility in this State where live entertainment is 32 provided, which are made or facilitated by the marketplace 33 facilitator on its own behalf or for one or more marketplace 34 sellers, exceed $100,000; or 35 (b) The marketplace facilitator, on his or her own behalf or for 36 one or more marketplace sellers, makes or facilitates a combined 37 total of 200 or more separate sales transactions of tangible 38 personal property to customers in this State and of admission to 39 any facility in this State where live entertainment is provided. 40 2. The provisions of this chapter relating to the imposition, 41 collection and remittance of the tax imposed by NRS 368A.200 do 42 not apply to a marketplace facilitator described in subsection 1 if: 43 (a) The marketplace facilitator and the marketplace reseller 44 have entered into a written agreement whereby the marketplace 45 – 6 – - *SB431_R2* reseller assumes responsibility for the collection and remittance of 1 the tax imposed by NRS 368A.200 for resales made by the 2 marketplace reseller through the marketplace facilitator; and 3 (b) The marketplace reseller has registered with the 4 Department to collect and [Text truncated for display. Full text available on LegiScan.]