These are all of the Taxes and Fees bills proposed in the 2018 session. Each bill has its own bill number, please use your browser search feature to find the bill you are interested in. Return to the Colorado home page to pick a different bill category.

None of the text is the opinion of Engage. Each bill's description, pros, and cons are our best effort at describing what each bill does, arguments for, and arguments against the bill. If you believe we are missing something, please contact us with your suggestion. Some of these bills have the notation that they have been sent to the chamber's "kill" committee. This means that the leadership has decided to send the bill to the State committee even though it does not belong there based on its subject matter. This committee, in both chambers, is stacked with members from "safe" districts and the idea is to kill the bill without forcing any less safe members to take a hard vote. It is possible for a bill to survive the kill committee, but it is very rare.

Each bill has been given a "magnitude" category: Major, Medium and Minor. This is a combination of the change the bill would create and the "controversy" level of the bill. Some minor bills that are extending current programs would be major changes if they were introducing something new, but the entire goal here is to allow you to better curate your time. Something uncontroversial likely to pass nearly unanimously that continues a past program may not be worth your time (and please remember, you can still read all of the minor bills!).

HB18-1004: Continue Child Care Contribution Tax Credit

Extends the child care contribution credit for five more years, to 2025. This allows a taxpayer who makes a monetary contribution to promote child care in Colorado an exemption worth 50% of the total value of the contribution.

SIGNED

Pros

Child care is one of the biggest problems facing any working family. This credit helps encourage financial support of child care and has worked well for Colorado since its inception in 2000.

Cons

Child care facilities should not be privileged to this extent above other forms of charitable giving.

How Should Your Representatives Vote on HB18-1004

HB18-1013: Income Tax Credit for Endowment Contributions

Allow an individual taxpayer to claim an income tax credit for contribution of money to an eligible endowment fund equal to 25% of the contribution, with a maximum of $5,000. Taxpayers cannot double-dip by counting the same donation toward this credit and another nonprofit donation credit. Department of Revenue is required to keep a cap on the credit of $12 million per year, with credits honored in the order they are received.

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Pros

This credit will encourage contributions to endowments, which would not ordinarily fall under the nonprofit donation tax deduction. These eligible endowments do great work all over Colorado and this will boost donations thus benefitting everyone, both economically and in community development. The state can easily afford the $12 million in lost revenue, since a key driver of state revenue is the TABOR cap, which forces the state to return money to taxpayers if it is breached.

Cons

The way the revenue cap is setup is fundamentally unfair to taxpayers, as there should be no reward for how fast you complete your returns. It will take 2,400 returns at the maximum of $5,000 to hit the cap, of course most returns will not be at the maximum, but taxpayers should be able to plan their taxes ahead of time and not get hit with unexpected tax bills because they filed in April instead of March. In addition, the tax code is already too complicated and privileges the wealthy, who can not only hire sophisticated tax attorneys to be aware of all of the potential tax breaks, but have the income to be able to make these kind of large donations ($20,000 to reach the $5,000 maximum).

How Should Your Representatives Vote on HB18-1013

HB18-1022: DOR Department of Revenue Issue Sales Tax Request for Information

Requires Department of Revenue to issue a request for information on a simplified electronic sales and use tax system that the state and local governments could use.

SIGNED

Pros

State and use taxes are unnecessarily complicated for Colorado businesses. Many have to file multiple returns with the same information for multiple jurisdictions. We need a better system and this is the necessary first step toward getting it.

Cons

We have separate systems because jurisdictions have different resources. Any one-size fits all solution may either force jurisdictions with sophisticated systems to use something worse or those without the resources for a more sophisticated system to come up with additional funds.

How Should Your Representatives Vote on HB18-1022

HB18-1036: Reduce Business Personal Property Taxes

Raises exemption for personal property for businesses from $7,400 to $50,000 and adjusts the exemption to inflation in the future.

*This bill has been sent to the House “kill” committee, State Affairs*

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Pros

Governor Hickenlooper has called this tax a headache for small business owners, so this is not merely a partisan push to slash taxes. It has a minimal impact on the state budget (a similar proposal last year was estimated to cost the state $1 million), and tagging it to inflation allows it to remain at the same level in years to come rather than de facto increases when it fails to keep up with inflation.

Cons

The problems with this type of proposal have not changed. It will cost local governments dearly: $52 million, and schools $19.8 million (again based on last year’s similar proposal). It will force an additional $60 million cut to local residential taxes because of the Gallagher Amendment (residents cannot pay more than 45% of overall property taxes in the state). This is all money that cannot be recouped with some sort of tax increase somewhere else, which requires the vote of the people due to TABOR. So the end effect will be large cuts to local governments and schools with no easy avenue to replace the revenue.

How Should Your Representatives Vote on HB18-1036

HB18-1060: Income Tax Deduction for Military Retirement Benefits

Allows an individual who is under 55 to claim up to $20,000 for a deduction to state income taxes for the individual’s military retirement benefits. Current law allows those 55-64 to claim the $20,000 deduction while those over 65 can exclude up to $24,000.

SIGNED

Pros

This is a dollar-to-dollar deduction (capped at $20,000) so it will have a proportional affect and off-set retirement income (military retirement benefits start the day you retire from the military). Colorado would join 18 other states in offering this benefit, which makes the state much more attractive to military retirees, who deserve special treatment for the sacrifices they have made for our country.

Cons

A similar bill from last year’s session estimated this would cost the state nearly $8 million in revenue. Because of TABOR, that revenue cannot be made up by increasing taxes somewhere else, it is just lost. When we owe our schools over $800 million and have an annual $1 billion shortfall in funding our roads and transit, we cannot afford to treat military retirement benefits in this special manner. This makes us similar to the majority of other states. Colorado also has no trouble attracting new residents, quite the contrary.

How Should Your Representatives Vote on HB18-1060

HB18-1084: County Lodging Tax Revenue Allowable Uses

Eliminates requirement that county lodging taxes be used only for advertising and marketing local tourism. Would need voter approval in for any county that already has a lodging tax.

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Pros

Tourism is the life-blood of many areas in Colorado, particularly the mountains. It makes sense to allow these areas to use the proceeds from tourists via the lodging tax for things other than just attracting more tourists and voter approval will be required.

Cons

Lodging taxes are levied against tourists and they were sold as a tax to help promote the area. This changes their basic purpose.

How Should Your Representatives Vote on HB18-1084

HB18-1185: Market Sourcing for Business Income Tax Apportionment

Changes the sourcing for business income tax from the sale of intangible property being based on where the service is performed to where the service is delivered.

SIGNED

Pros

As the nation moves to a more service-oriented economy it is important to align the state’s tax laws to this reality. Assigning the revenue based on service delivery means the money is going to be used in the state is was spent in, and as more states adopt this philosophy, Colorado may become more popular for multi-state businesses to locate in, since they will only be taxed for activity in Colorado.

Cons

Colorado may become more popular for business headquarters, which may or may not employ very many people, but it may also become less popular for multi-state business service locations, where the tax that used to be paid only in the home state now must be remitted to Colorado.

How Should Your Representatives Vote on HB18-1185

HB18-1201: Severance Tax Voter-Approved Revenue Change

This would put an issue on the ballot to remove severance taxes (paid by oil and gas companies) from causing the state to go over the TABOR revenue cap as long as the state does not repeal or reduce any existing severance tax exemptions or credits or reduce the amount of severance tax revenue allocated to local governments.

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Pros

Severance taxes tend to fluctuate wildly based on the price of oil which makes it very difficult for the state to budget for. They also have grown rapidly in the past few years (although the lower price of oil recently has put more of a damper on them), so it makes sense to remove them from the TABOR cap to allow a steadier planned level of state income, especially since if there is a need for a TABOR refund, these taxes are likely to get plucked first, rather than go to the counties affected by oil development as intended.

Cons

This is circumventing TABOR by in essence raising the cap. The state can budget just fine for TABOR, it knows what the cap is and knows it shouldn’t spend more than it. Whether or not severance taxes come in high or not is irrelevant. TABOR has served this state well and should not be weakened.

How Should Your Representatives Vote on HB18-1201

HB18-1203: Reduce State Income Tax

Reduces the state income tax from 4.63% to 4%, and the alternative minimum tax by the same 0.63% amount.

*This bill has been sent to the House’s “kill” committee, state affairs*

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Pros

Last year the state legislature passed a bill that required each agency, except education and transportation, to submit a budget 2% lower than their previous year. The governor ignored this mandate and therefore the only recourse is to lower the tax rate so that less revenue comes in and the desired 2% reduction in government size is achieved and money is kept in the hands of citizens. In addition, the state legislature raised the TABOR cap without asking the voters, by removing the hospital provider fee from the cap. This bill helps restore the balance that was lost.

Cons

We have a $1 billion shortfall in transportation and owe our schools over $800 million. We most definitely do not have too much revenue. This is merely the “starve the beast” playbook, where instead of making the case for spending less money with specific examples, politicians lower the amount of money in the system, then claim we don’t have enough money to pay for things. Colorado’s economy is booming with our current tax structure. Our unemployment is among the lowest in the country. The state is one of the fastest-growing in the country. We don’t need lower taxes.

How Should Your Representatives Vote on HB18-1203

HB18-1283: Classify Residential Land Change in Improvements

Requires property where residential improvements are destroyed or relocated to continue to be taxed as residential land for the year of the change and one subsequent year if the assessor determines that the owner intends to rebuild a residential improvement on the land.

SIGNED

Pros

This closes a loophole where residential land is still going to be residential land, it’s just temporarily not due to new or imminent construction.

Cons

If it is not being used for residential purposes, then it isn’t residential land. Once it resumes being used for residential purposes, then it can be taxed again at that level. The added burdens of investigating contract permits, financing, or construction plans may not outweigh the gains in tax.

How Should Your Representatives Vote on HB18-1283

HB18-1315: Manufactured Home Sales Tax Exemption

Currently 48% of the purchase price of a manufactured home constructed in compliance with federal standards is exempt from state sales and use tax. The subsequent sale of such a home is entirely exempt. This bill creates the same complete exemption for the purchase prices as subsequent sales.

SIGNED

Pros

It is only fair that if we are going to exempt these types of homes from sales tax, in order to encourage home ownership, that we exclude any type of purchase and not single out the first sale.

Cons

The reason we collect tax on the first instance is because it is on the creation of the actual object, the state gets the tax when it is created then we don’t continuously tax it every time it changes hands later.

How Should Your Representatives Vote on HB18-1315

HB18-1359: Colorado Charitable Contribution Income Tax Deduction

Currently those who cannot claim a federal tax deduction (due to taking the basic standard deduction) for charitable contributions can take a deduction for charitable contributions that exceed $500 of the amount they could have gotten from the IRS. This bill removes the $500 threshold.

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Pros

The $500 limit discriminates against hard-working Coloradans who are not wealthy enough to contribute more than that to charity. If we are going to reward charitable contributions, we should award all of them, not just those by the wealthy who don’t need the break as much.

Cons

This would take an estimated $13 to $21 million out of the state budget (depending on how many people take advantage of it). That money is not being replaced by some other funding source, it is a direct cut to the state’s budget. Some worthy program somewhere is going to get cut, or schools will get slightly less funding, or both and more.

How Should Your Representatives Vote on HB18-1359

SB18-061: Reduce the State Income Tax Rate

Reduces the state income tax rate from 4.63% to 4.43% and the state alternative minimum rate by 0.2%.

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Pros

Last year the state legislature passed a bill that required each agency, except education and transportation, to submit a budget 2% lower than their previous year. The governor ignored this mandate and therefore the only recourse is to lower the tax rate so that less revenue comes in and the desired 2% reduction in government size is achieved and money is kept in the hands of citizens.

Cons

The only reason the bill passed last year was that the 2% reduction was not mandatory. Everyone knew the governor and the Democrats were going to ignore the suggestion. We have a $1 billion shortfall in transportation and owe our schools over $800 million. We most definitely do not have too much revenue. This is merely the “starve the beast” playbook, where instead of making the case for spending less money with specific examples, politicians lower the amount of money in the system, then claim we don’t have enough money to pay for things. Colorado’s economy is booming with our current tax structure. Our unemployment is among the lowest in the country. The state is one of the fastest-growing in the country. We don’t need lower taxes.

How Should Your Representatives Vote on SB18-061

SB18-070: Church Property Tax Exemption

Property that is used for religious worship is exempt from taxation by the state constitution. The state’s laws require the property to be owned in order to be eligible. This bill removes the ownership requirement so that leased properties that are used solely and exclusively for religious purposes can also be exempt.

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Pros

It simply is not fair to force religious organizations to own property in order to avoid the property tax. The bill keeps the solely and exclusively enforcement, so there is no concern about someone trying to game the system. To qualify, the land is going to have to be used for religious purposes “solely and exclusively.” The owner of the property is using it in exactly the way the law is intended to reward.

Cons

Leased property taxes are paid for by the property owner. It is true that the property owner can make the tenant pay for these taxes in the lease agreement, but religious organizations are free to sign agreements without this provision. This bill would accrue the benefits of the tax exemption to the property owner, who by definition would be not the religious organization engaging in the activity that triggers the exemption.

How Should Your Representatives Vote on SB18-070

SB18-128: Legislative Approval for State Agency Fee Increase

Requires all state agencies to submit proposed fee increases to the joint budget committee and approval of a majority of the committee to enact it.

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Pros

Right now too many state agencies can increase their fees without referral to the people’s elected officials at all. This provides a needed check by the legislative committee that deals with all budgeting matters.

Cons

The legislature already has a remedy to deal with fee increases it does not like: passing a law to change it. This puts too much power in the hands of the legislators on the budget committee, who can in effect veto any fee increase without recourse. It usurps the authority of the executive branch and concentrates too much power in six of the 100 state legislators.

How Should Your Representatives Vote on SB18-128

SB18-141: Income Tax Check-Off Nonprofit Donation Fund

Creates a non-profit fund that will appear as soon as space becomes available on state tax returns for voluntary contributions with tax refunds. The state will keep a list of eligible charities and the taxpayer writes in which charity they want to donate to. If the state cannot determine what charity was desired or if the organization is not eligible, the money is returned to the taxpayer.

SIGNED

Pros

This is a wonderful opportunity to expand the highly successful voluntary donation concept (over $30 million since its inception in 1977) to a whole host of non-profits. Currently the list is crammed full (as the need to go on a waiting list demonstrates), this is a way to put one item on it that represents many different deserving charities.

Cons

This is going to cost money to run, so part of people’s contributions will actually go to operating the fund. It’s also a potential for chaos, as taxpayers must successfully pick an appropriate name and clearly indicate it on the form. The ordering of the list of charities will also be critically important as many people will just read through until they find one they like. However the order is determined is going to disadvantage someone.

How Should Your Representatives Vote on SB18-141

SB18-143: Parks and Wildlife Measures to Increase Revenue

Increases numerous parks and wildlife fees and gives the state’s wildlife commission the ability to increase the fees as necessary in the future, with some restrictions.

SIGNED

Pros

The division of parks and wildlife has a $44.76 million maintenance and repair backlog for dams, $26 million for large capital construction and maintenance, and needs to modernize its fish hatcheries and public access as well as increase the state’s big game and endangered species populations. This bill gives them the funds to do some of this, as well as the ability to better control their own revenues. Parks and wildlife are an absolutely critical part of the Colorado economy and we must invest in them.

Cons

This gives the wildlife commission too much power for setting fees by taking it out of the hands of the legislature. If fees need to be increased in the future, they can be through another bill similar to this one.

How Should Your Representatives Vote on SB18-143