Colorado voters approve Amendment 87 which changes how income taxes are calculated

Colorado voters approved Amendment 87, which will change how income taxes are calculated.

Opponents claim Amendment 87 would be the biggest tax increase in state history. Supporters claim 97% of Coloradans would see a tax decrease under the measure. It turns out, they are both right. 

According to nonpartisan fiscal analysts, the measure would increase taxes by up to $2.7 billion the first full year.    

But only individuals and businesses that have incomes of over $550,000 a year would pay the increase. According to Colorado Department of Revenue data, 3% of individual taxpayers fall into that category, and 5% of businesses do as well.

The ballot measure changes the Taxpayer Bill of Rights, which states that all net income must be taxed at the same rate, and instead creates different tax rates for different income levels.

• $25,000 or less would be taxed at 3.7%
• $25,001 to $100,000 would be taxed at 4.2% 
• $100,001 to $500,000 would be taxed at 4.4%
• $500,001 to $750,000 would be taxed at 7.4%
• $750,001 to $1 million would be taxed at 7.9%

And any income above $1 million would be taxed at 8.4%, which is nearly double the current rate.

State analysts estimate anyone making below $550,000 would see a tax cut of $175 to $325 per year.

Anyone making above $550,000 would see a tax increase of $1,175 to $55,925 per year. 

All the additional tax revenue would be exempt from the state's current spending cap and could only go to programs related to K-12 education, healthcare, and childcare.  

Supporters claim the measure creates a fairer tax code by aligning rates with taxpayers' financial means, while also helping fund public services as the state faces budget shortfalls.

Opponents note the state budget has grown 72% over the last 10 years as taxes have climbed by nearly $20 billion.   

They say the tax cuts will pale in comparison to the job losses as more businesses leave the state.