Proposition 121: Coloradans will decide whether to cut the state income tax rate — again |

Proposition 121: Coloradans will decide whether to cut the state income tax rate — again

The measure, run by conservative political groups, would slash Colorado’s income tax rate to 4.4% from 4.55%

Jesse Paul
The Colorado Sun
Light filters through the dome of the Colorado State Capitol as the 2022 legislative session opened Wednesday, Jan. 12, 2022, in Denver.
David Zalubowski/ AP

Proposition 121 asks Colorado voters for the second time in two years to decide whether to reduce the state’s individual and corporate income tax rate.

In 2020, voters approved a ballot measure slashing the rate to 4.55% from 4.63%. Proposition 121 would go even further, reducing the rate to 4.4% from 4.55% starting in tax year 2022, which mirrors the calendar year.

The rate reduction is projected by nonpartisan legislative staff to lower state tax revenue by $412.6 million in the 2023-24 fiscal year, which begins July 1, 2023. That would represent roughly a 2.4% cut to the General Assembly’s general fund. 

The general fund hit is likely to go up in future fiscal years as wages increase. 

Colorado has had a flat income tax — meaning the rate doesn’t change based on people’s income — since 1987. That means higher earners will save more money if Proposition 121 passes. 


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