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Posted: May 13, 2010

Maybe Colorado’s taxes aren’t so taxing after all

Five tax facts to help put it in perspective

By The Colorado Fiscal Policy Institute

Nobody loves paying taxes, but complaints that Colorado residents pay sky-high taxes or that tax rates are higher than ever are off-base. Here are some facts to help put the issues in perspective.

*Nearly every working person benefitted from $288 billion in tax cuts that were part of the American Recovery and Reinvestment Act of 2009, commonly known as the Recovery Act. The benefits included expansions of tax credits that help lift working families out of poverty such as the Earned Income Tax Credit.

*Tax cuts in the Recovery Act reached 98 percent of working Americans in 2009, according to a new study by Citizens for Tax Justice. The average benefit in Colorado was $1,096.

*Tax cuts in the Recovery Act cut across income brackets. The Making Work Pay credit, for example, benefitted families with incomes of up to $150,000, and families with higher incomes could be eligible for partial credits. The Making Work Pay tax credit is responsible for $751 million in economic output in Colorado and 5,473 jobs, according to analysis by the Colorado Fiscal Policy Institute.

*The federal Earned Income Tax Credit, which was expanded under the Recovery Act, is responsible for $577 million in economic output in Colorado and 4,166 jobs, the Fiscal Policy Institute's analysis found. Colorado's state Earned Income Tax Credit is dormant because lawmakers have declined to fund it.

*Colorado residents are not heavily taxed - combined state and local taxes per $1,000 of personal income were fifth-lowest in the nation according to a 2009 study by the nonpartisan state Legislative Council. Nor is Colorado a high-spending state. The state ranks 45th-lowest in the nation for overall state spending per capita, 49th in state spending per capita on health care for the poor, 48th in state spending per capita on higher education and 48th in state spending per capita on highways, according to the Fiscal Policy Institute's research.

 More detail is available on the Colorado Fiscal Policy Institute's Web site, www.cclponline.org.

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The Colorado Fiscal Policy Institute, a nonprofit, nonpartisan project of the Colorado Center on Law and Policy, promotes justice and economic security for all Coloradans. Find out more at www.cclponline.org.

 

Enjoy this article? Sign up to get ColoradoBiz Exclusives. The opinions expressed in this article are solely that of the author and do not represent ColoradoBiz magazine. Comments on articles will be removed if they include personal attacks.

Readers Respond

There are and always have been those who would rather spread fear than deal with facts, that would rather tear down than try to build something better. It's the same mentality and turn of mind that led the Luddites to attack machines, and there's a little Luddite in us all. We have common needs in transportation, education, and health care there are not being met and while I, like everyone, else hate to pay taxes they are truly a necessary evil. Abe WalkingBear Sanchez By Abe WalkingBear Sanchez on 2010 06 01
Mr. White, thanks for your comments. ColoradoBiz did not identify the authors as "non-partisan"; the copy to which you refer is provided by them, and can be found here as well, http://www.cclponline.org/ccs/aboutus.php#mission. We encourage all our contributors to provide descriptive copy for the benefit of readers. The CACI submission directly above is similar in this regard. Perhaps your confusion stems from the spacing on the web page. If so, our apologies. Thanks again. By Publisher on 2010 05 17
Actually, Co Biz did identify the organization's political objectives as "non-partisan" and that was and is my objection. You can change the subject and obfuscate all you want but that reality in print hasn't changed. And by the way, whenever I see the "free press" canard, I really get interested because then I know there's deception involved. No one actually cognizant of the Founder's intention for the First Amendment would be proud of how freedom of the press is being used as an excuse for shoddy journalism and ill formed opinion. They would clearly understand why the American public rates the press lower than whale shit in even the Pew polls. Look it up. By Robert White on 2010 05 17
Robert --- Colorado Biz Mag does not label columns as news. As with any other publication, the views of the columnist are those of the columnist alone and not of the publication. My column is not news, either. It is my opinion. You just don't happen to agree with the opinion in this article --- fair enough. But Colorado Biz Magazine is under NO obligation to identify "the ...organization's political objectives." It is a column in a publication and, therefore, is, by definition, "op-ed." Colorado Biz Magazine is NOT responsible for the opinions of their columnists, and sensible people don't take columns as news. Again, Colorado Biz Magazine publishes a VARIETY of opinions and viewpoints, and does not try to censor or otherwise restrict their columnists. It isn't a conservative or liberal issue. It is a free press issue. By John Heckers, MA, CPC, BCPC on 2010 05 17
John, While I don't know your political leanings, calling that piece "journalism" is what modern day liberals/progressives do with a pure opinion piece they agree with. If it were journalism, contrasting perspectives would be included and the "reporter" would not represent an organization with a dog in this hunt. Whe CO Biz publishes an op-ed they should label it as such and identify the author and organization's political objectives. That they did not do so is a violation of journalistic ethics--which is my complaint. I don't have a problem with differing points of view. I do have a problem with opinion pieces masquarading as news. By Robert White on 2010 05 17
Oh, and Robert -- Colorado Biz publishes freely a diversity of opinions, and has always valued a vigorous discussion from all viewpoints. Just because they publish something that is interesting and informative doesn't mean that the editors or owners of Colorado Biz necessarily agree (or disagree) with it. This is called "journalism." By John Heckers, MA, CPC, BCPC on 2010 05 16
Colorado has the most complex tax structure in the nation, as we learned while trying to put up an internet store. Jurisdictions do not correspond to zip codes, and every jurisdiction has a different sales tax and RTD tax structure, giving companies that sell through the internet a major pain in the behind. But a goodly part of the reason that companies leave Colorado is BECAUSE our low taxes will not allow Colorado to incentivize companies as, say, Minnesota can do. Also, our roads and highways are disgraceful. And I'm not sure I like ranking near the bottom in helping those who cannot help themselves. Just looking at one thing --- taxes --- as so many are apt to do doesn't tell the whole story. We need to look at what kind of state we want to have. By John Heckers, MA, CPC, BCPC on 2010 05 16
Why don’t you look at taxes that drove Colorado based companies out of the state? Why don’t you look at the wasteful spending on the part of the city of Denver and the State of Colorado? Its not just high individual taxes, it irresponsible spending and soaring taxes on business that drive them to not hire more workers. This prevents businesses from hiring more people thereby worsening our unemployment situation. Business have to pass on the taxes to the customers, to stay alive. So yes we are highly taxed. By Charles Van Rickley on 2010 05 13
To identify this liberal think tank as "non-partisan" is pure deception and Colorado Biz is collaborating by not calling them out on it. By Robert White on 2010 05 13

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