Rocky Mountain Voice reports that Initiative 195 would end Colorado’s flat income tax and replace it with six brackets, ranging from 3.7 percent on the lowest taxable income to 8.4 percent on income above $1 million. The measure is being sold as a tax cut for most Coloradans and a “fair share” tax hike on higher earners, with the state estimating it could raise up to $2.7 billion a year for schools, health care, early childhood programs, and school meals.
But the certified ballot title gives away the game. A household earning under $25,000 would save $9 a year. Nine dollars. That is not economic relief. That is a sad gas-station burrito with just enough change left over to feel insulted. Meanwhile, a filer reporting between $2 million and $5 million would pay about $13,914 more.
The article also highlights a warning from the Common Sense Institute: the very households and businesses expected to cough up the new money are also the ones most able to move. That does not mean every high earner is loading a U-Haul tomorrow. It does mean revenue projections are not magic spells. If the people being taxed can leave, the spreadsheet does not get a vote.
The Bullet Point Brief
- Initiative 195 would scrap Colorado’s flat 4.4 percent income tax and replace it with a graduated tax system. Progressives call that fairness. Normal people recognize the old “just one more bracket” routine wearing a new thrift-store jacket.
- The sales pitch is that anyone under roughly $500,000 in taxable income would pay the same or less. For households under $25,000, that “less” is about $9 a year. Nothing says compassion like buying political support with burrito money.
- Higher earners get the hammer. A filer between $1 million and $2 million would pay about $4,764 more, while one between $2 million and $5 million would pay about $13,914 more. Apparently “fair share” now means “we found a smaller group and hope they sit still.”
- Common Sense Institute warns the tax could cost Colorado revenue when high earners and firms adjust their behavior. CSI projects a net loss of firms, corporate profit, and personal income tied to migration effects. Funny thing about mobile money: sometimes it moves.
- Backers say the measure cuts taxes for 98 percent of Coloradans and raises taxes only on those earning more than $500,000. That sounds tidy until you remember Colorado also has small businesses structured as pass-through entities, meaning business income can show up on personal returns. The taxman does not care whether the money came from a yacht or a payroll headache.
My Bottom Line
This is Colorado’s latest tax-the-rich fairy tale, and the plot is getting stale.
The ballot-measure crowd wants voters to believe they can hand most people a tiny symbolic tax cut, punish a narrow group hard enough to call it justice, and then keep every dollar the spreadsheet imagined. That is not policy. That is a redistribution gimmick with a bumper sticker.
The insult is the $9. Truly, behold the generosity. A household under $25,000 gets enough to maybe survive the convenience-store roller grill, while the state asks high earners to cough up thousands more and then acts bewildered when somebody asks whether those taxpayers might reconsider their Colorado zip code.
This is the arrogance baked into every progressive tax scheme. They assume taxpayers are livestock. Stand there. Produce. Feed the beast. Do not ask questions. Do not hire accountants. Do not move your company. Do not notice that other states exist.
Maybe some stay. Maybe many stay. The article is careful about that, and we should be too. But the point is not that every high earner bolts for Florida before breakfast. The point is that the people being targeted are the people with the most options. When government builds its budget fantasy on the assumption that successful people will sit still and take it forever, government is not planning. It is daydreaming with your wallet.
Colorado Democrats found another way to call a tax hike compassion while ignoring basic human behavior. But revenue projections do not pay bills. People do. And when people can leave, the ballot language cannot chain them to the porch.
Source: Rocky Mountain Voice
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