Colorado was ranked as having the 7th lowest effective tax rate in the country. This outside analysis was conducted by WalletHub, which analyzed the Real-Estate Tax, Vehicle Property Tax, Income Tax, and Sales & Excise Tax. According to Wallethub’s comprehensive analysis, Colorado has lower taxes than all its neighboring states except Wyoming, as well as lower taxes than self proclaimed ‘low tax’ states including Florida (9), and Texas (42).
Governor Jared Polis
“Income tax cuts and saving people money has been one of my top priorities since day one, and I’m proud of the work Colorado has done to reduce taxes for everyone. From cutting the income tax three times and property taxes five times to exempting many additional items from the sales tax – we have helped more Coloradans keep more of their hard-earned money. I look forward to building on this work, including if there are opportunities for additional, revenue-neutral income tax cuts for Coloradans,” said Governor Jared Polis.
Laws Governor Polis has signed to reduce taxes include:
• SB26-010 – Agricultural Property Tax Definitions: Helps Colorado farmers, ranchers, and rural communities by saving agriculture producers money on property taxes.
• SB24-233 – Property Tax: Reduces the improved commercial and agricultural assessment rates for 29% down to 25% by Tax Year 2026.
• HB24-1311 – Family Affordability Tax Credit: Gives money back to Colorado families with children younger than 17, up to $3,200 per child, when there is a TABOR surplus. This helped cut child poverty rates by nearly 41%.
• HB24B-1001 – Property Tax: Accelerates the assessment rate reductions from SB24-233 on improved commercial and agricultural property to 25% to 2025, and expands the assessment rate reduction to the general commercial, industrial, natural resources, and state assessed classes by Tax Year 2027.
• SB22-238 – 2023 And 2024 Property Tax: Passed with bi-partisan support, reduced the nonresidential property assessment valuation for 2023 from 29% to 27.9% of actual value, and extended the lower agriculture and renewable energy rates from SB21-293 into 2024.
• HB22-1055 – Sales Tax Exemption Essential Hygiene Products: Ended the state sales and use tax on feminine hygiene products and diapers.
• SB 21-293 – Property Tax Classification And Assessment Rates: Reduced property tax assessment rates for agriculture, renewable energy, from 29% to 26.4%.
• HB21-1311 – Income Tax: Closes tax loopholes that benefit special interests and puts more money into Coloradans’ pockets by eliminating all income taxes on social security for seniors over age 65 and giving tax relief to families with young children through Colorado child tax credit. This legislation also doubles Colorado’s Earned Income Tax Credit, helping an estimated 320,000 hard-working Colorado families earn their way out of poverty.
• HB21-1312 – Insurance Premium Property Sales Severance Tax: Exempts tens of thousands of small businesses from having to pay or even file the Business Personal Property tax on their businesses personal property, saving Colorado’s small and growing businesses thousands of dollars annually.