Actually started as 13 bills, HB 10-1189-1200, eliminate tax exemptions for things such as candy and soda, software, energy use, cooperative direct mail, and agricultural products. The tax increases are designed to help cover budget shortfalls which amount to approximately $140 million. Democrats say the measures will save the state of Colorado $125.8 million but I believe the ‘Dirty Dozen’ will cost Colorado 15,000 jobs. The bills passed the house on a party-line vote. We (Republicans) fought each of the twelve bills because the package will hurt struggling Colorado businesses and cripple consumers. The ‘Dirty Dozen’ circumvent the TABOR (Taxpayer Bill of Rights) requirement to receive prior voter approval before raising taxes. Many, if not all, of the passed ‘Dirty Dozen’ tax increases are likely to be challenged in court as violations of the Colorado Constitution.
HB 10-1189: Eliminates the sales-tax exemption on direct mail materials
HB 10-1190: Eliminates the sales-tax exemption on fuel sales used for industrial purposes
HB 10-1191: Eliminates the sales-tax exemption on candy and soda
HB 10-1192: Eliminates the sales-tax exemption on software purchased anywhere other than a retail store
HB 10-1193: Requires in-state affiliates of out-of-state on-line retailers that direct customers to purchase from those businesses to pay sales tax on the materials that are bought
HB 10-1194: Eliminates the sales-tax exemption on non-essential food containers like plastic bags
HB 10-1195: Suspends the sales-tax exemption on agricultural compounds, pesticides and bull semen
HB 10-1196: Narrows the definition of vehicles that are eligible for alternative-fuel tax credits
HB 10-1197: Decreases the maximum amount of a state income tax credit that may be claimed for the donation of a conservation easement in gross.
HB 10-1198: Suspends the credit against the state income tax of a portion of the credit allowed under the federal internal revenue code for payment of the alternative minimum tax.
HB 10-1199: Limits to $250,000 the amount of net operating loss that businesses can carry over on their taxes for the next three years
HB 10-1200: Requires that a taxpayer defer claiming any amount of an enterprise zone investment income tax credit that exceeds two hundred fifty thousand dollars.
These bills will be particularly harmful for the citizens of Colorado because as we place a greater tax burden on business (increasing business costs) they are forced to lay-off employees, pass the burden on to consumers, or even worse, go out of business. We have already seen the negative impacts since the Governor signed these bills into law in March. We placed a sales tax on internet franchises in Colorado (dubbed the Amazon.com tax.) This tax forced Amazon from doing business with franchisees in Colorado costing thousands of jobs.