Colorado Democrats Want Tax Reform That Acts Like a Tax Hike

The Denver Post reports that Colorado Democrats have rolled out a “tax reform” package designed to decouple parts of Colorado’s tax code from recent federal tax changes, specifically the tax cut bill Congress passed last year and President Trump championed. The pitch from sponsors is that the state should not automatically mirror federal breaks, and that Colorado should instead capture additional state revenue to fund or extend credits aimed at low and middle-income families with kids.

In the article, lawmakers describe the package as shifting benefits away from large corporations and toward working families, with particular attention to keeping a version of the Family Affordability Tax Credit alive after federal changes lowered Colorado’s tax collections below a threshold tied to that credit. On the other side, business groups warn this is a competitiveness hit dressed up as compassion, and that it amounts to a tax increase when companies are already weighing where to expand, or whether to stay.

The Bullet Point Brief

• The package is built to separate Colorado tax rules from federal tax breaks, so the state can “capture” money that would otherwise flow through. Translation: Washington cuts, Colorado claws back.
• The bills would limit or roll back state-level benefits tied to things like operating losses, depreciation write-offs, and interest deductions, meaning filers would not get the full federal benefit on their Colorado return.
• Democrats frame it as protecting families, including shoring up a new family credit structure that mirrors the existing Family Affordability Tax Credit design after federal changes disrupted the state’s revenue picture.
• The business community is waving the red flag hard. Colorado Chamber CEO Loren Furman says, “Together, these proposals shift the burden of Colorado’s budget shortfall on the backs of employers of all sizes… these bills will increase taxes on businesses… further driving companies and families out of the state due to sky-high costs.” That quote is the whole story.
• Even Polis is noted as wanting broad-based tax cuts as part of any package, while one sponsor says she would “never in a million years” consider that. So the governing posture is pretty clear: cuts are for speeches, not for law.

My Bottom Line

These Colorado Democrats have no shame. None. The Trump Administration passes tax relief, but ruling Colorado Democrats cannot have that in Colorado, so they sprint to decouple state tax policy from federal tax policy. Why? Because decoupling is how you quietly keep the money in Denver instead of letting it stay with the people who earned it.

Colorado does not have a revenue problem. Colorado has a spending problem. And when you refuse to talk about spending, you inevitably start hunting for “procedural changes” and “reforms” that somehow, every single time, end with the same result: more of your money going to the government. They call it “affordability,” but they fund it by making employers pay more to operate here. That is not affordability. That is political alchemy.

The Denver Post lays it out, and the chamber quote nails it: these proposals shift the burden of the budget shortfall onto employers of all sizes and increase taxes on business while Colorado’s competitiveness is already sliding. Then everyone under the Gold Dome acts confused when jobs, investment, and headquarters decisions start drifting to friendlier territory.

Set an egg timer. That’s how long it will take more Colorado businesses to start looking for new homes, and the jobs will leave right along with them. When the state treats private-sector growth like a piñata and “reform” like a hiding place for tax hikes, the only surprise is that more companies have not packed up already.

Source: The Denver Post