Ahead of a Colorado Chamber of Commerce announcement on the impact of new taxes, the Denver-based Common Sense Institute added up the costs in an analysis obtained by Colorado Politics Monday morning.
Whether they are fees, which the legislature can authorize, or taxes that must be approved by voters, current proposals would ring up $1.8 billion a year in each of the next three to five years, analysts estimated.
While that's good for state government, it will be a strain for recovering businesses, experts are expected to say at a Tuesday press conference.
The white paper breaks down the cost of each individual proposal.
Read the full report by clicking here.
The chamber's press conference to discuss the findings will be at 10 a.m. Tuesday online.
The discussion is expected to include:
- Loren Furman, senior vice president of state and federal relations for Colorado Chamber of Commerce
- Tony Gagliardi, Colorado state director for the National Federation of Independent Businesses
- Dave Davia, CEO and executive vice president of the Rocky Mountain Mechanical Contractors Association
- Rachel Beck, vice president of government affairs for Colorado Springs Chamber of Commerce and EDC
- Diane Schwenke, president and CEO of the Grand Junction Chamber of Commerce
- Kelly Brough, president and CEO, Denver Metro Chamber of Commerce
Register for the Zoom call by clicking here.
The General Assembly is expected to look at new taxes or fees to fund transportation and avoid painful cuts caused by the pandemic. Business interests are aligning to oppose them, saying now is not the time, as the state's economy is trying regain traction.
The Common Sense Institute white paper lays out how the Colorado economy started as first in the nation in late 2019, but the "economic shocks" of 2020 has left the state economy "under duress" as lawmakers convene in Denver to sort out the repercussions of COVID-19.
The report notes that the state now has 150,000 fewer jobs — roughly equivalent to the population of Lakewood — which amounts to a 5.4% reduction in the tax-paying, paycheck-spending workforce.
"While the statewide reduction is significant, it masks the disproportionate impacts across industries, as the leisure and hospitality industry was down 90,900 jobs by end of 2020, whereas professional and business services was up 7,100 jobs," the Common Sense analysis found.
Taxable sales fell $8.9 billion, a decline of 1.35%, last year over 2019, and small businesses that were shuttered by stay-at-home orders saw their revenue tumble 29.5% as of Feb. 10, the report states.
Colorado’s unemployment rate increased from 2.5% to 8.5%, the second highest increase in the country, behind Hawaii and ahead of Nevada. Colorado fell for 48th highest unemployment rate before the pandemic to the fourth highest.
While vaccinations offer reason for optimism, the uncertainty of a resurgence and more restrictions also offer business people reasons for continued anxiety, according to the analysis.
"This uncertainty over the next year is coupled with significant unemployment insurance tax increases and other regulatory cost increases that will shape the ability of the Colorado economy to recover more quickly," concludes the Common Sense Institute.
The proposed taxes and fees don't include those that result from legislation and regulations adopted before the pandemic, the report notes. Those include mandatory paid sick leave, increased health insurance benefits, as well as new oil and gas regulations, including new mandates on emissions.