3-year tax increase would funnel extra $1.63 billion into state education coffers
A Boulder senator wants Coloradans to increase taxes for the next three years so the state can collect an additional $1.63 billion for education.
Sen. Rollie Heath, D-Boulder, said the ballot question he filed with the state Monday is needed in light of the $375 million cut to K–12 spending Gov. John Hickenlooper proposed for next year’s budget, which could be repeated over the next few years because of the state’s slow recovery from the recent recession.
“As a businessman, I fully understand that we need economic development in Colorado to continue climbing out of this recession,” Heath said of the cuts.
“If we want to compete in a knowledge-based and technological world of the future, we’ll need excellence in education, and that requires funding.”
Under Heath’s plan, which he’s proposing as a citizen’s initiative for this fall’s ballot, income taxes would rise from the current 4.63 percent to 5 percent for tax years 2012 through 2015. All the money collected from the increase would go to public schools and higher education.
Republicans immediately denounced Heath’s proposal, saying they agree with Hickenlooper that Colorado voters have no appetite for a tax increase.
“Colorado families and businesses have said loud and clear they do not want any more taxes during this recession,” said Senate Minority Leader Mike Kopp, R-Littleton. “They know a tax increase will only exacerbate the economic slowdown, and that, like them, government must live within its means.”
But Carol Hedges, director of the Fiscal Policy Institute for the Colorado Center on Law & Policy, questions how anyone knows what the voters want because a broad-based tax increase hasn’t been proposed to voters in years.
Coloradans she’s talked to are so tired of cuts to such essential services as education, health care and public safety that there just might be an appetite to increase taxes, Hedges said.
That’s why her group is proposing a ballot question of its own to do away with the state’s 4.63 percent flat tax and institute a graduated income tax rate similar to the federal government’s.
“Folks with lower income pay a much higher percentage of their total income,” she said. “The point of the graduated income tax is to try to make it so that everybody pays about the same percentage.”
Under her plan, which is expected to raise about $1.3 billion a year, people making $50,000 or less would see their tax rates reduced to 4.2 percent.
People making $50,000 to $100,000 would pay a 6.5 percent rate.
The rate would increase to as high as 9.5 percent for those people who earn more than $1 million a year.