Jared Polis: A New Year’s tax cut surprise for every Coloradan 

Jared Polis: A New Year’s tax cut surprise for every Coloradan

Published on Dec 31, 2019 5:03AM MST

Jared Polis @GovofCO

As we end 2019 and look forward to 2020, I’m excited to work hard to help Colorado tackle tough challenges in the next decade.

Jared Polis

The common thread throughout my first year in office has been working hard to save Coloradans money — on education, health care, utility bills, housing and more.
Families are already saving $300-$500 a month on full-day kindergarten, with up to $700 a month more in savings for families who buy their own healthcare because of reinsurance.
I am proud of the accomplishments we have made on so many fronts and I am excited to get to work to save Coloradans even more in 2020.

I would like to save Coloradans more money on taxes too. Happily, this year every Coloradan will receive real tax relief as of Jan. 1: Our Colorado income tax rate is going down to a historic low of 4.5% for 2020.
That means that for every $100 you pay in state taxes, you’ll owe about $2.80 less. This tax cut applies to all taxpayers including individuals and all businesses. Last year, thanks to the leadership of the legislature, we further lowered the tax burden for every small retailer in Colorado and we also lowered the residential assessment rate for property taxes.
As governor I hope to deliver an economy next year and the years beyond that produces tax cut refunds more regularly, as I will work enthusiastically with both Democrats and Republicans to identify ways to make an income tax cut permanent without reducing state revenue.
Now I am proud of the great strides we have made on many ideas my administration has put forward, but we have not batted 1,000 as any ball player hopes to do. We have not yet made much progress on two of my administration’s major fiscal initiatives, a permanent tax cut and building up our reserves for a rainy day.

Last year I called for a revenue neutral tax reform proposal that would have eliminated deductions and loopholes that benefit special interests in order to cut taxes for all. While we didn’t accomplish it last year, I still strongly believe it’s the right thing to do.
Why? Simply put, I believe in science. The world is not flat; vaccinations work; and a broader base taxed at a lower rate leads to greater economic growth with the ancillary benefit of preventing the corrosive influence of crony capitalism.
In 1962, President Kennedy inspirationally called for “an across-the-board, top-to-bottom cut in personal and corporate income taxes” because the tax system “exerts too heavy a drag on growth in peace time … siphons out of the private economy too large a share of personal and business purchasing power … [and] reduces the financial incentives for personal effort, investment, and risk-taking” and later delivered on that tax cut.
In 2010, President Obama directed his economic team toward “closing loopholes and simplifying income taxes for corporations and individuals. … to rid the code of its complex buildup of deductions, credits and exemptions, thereby broadening the base of taxes collected and allowing for lower rates.”
But it’s not just Democrats who believe in helping people to hold onto more of their own hard-earned money.

Even President Trump tried to cut taxes, but while the Tax Reform of 2017 contains some positive aspects including some rate reductions and the creation of Opportunity Zones, which I worked with Sen. Michael Bennet on and are an important part of our blueprint for rural economic growth, it also had two cardinal flaws. First, it wasn’t paid for, thus leading to record budget deficits and ballooning debt. Second, it was so convoluted that it actually raised taxes for many middle-class families.
It is my hope that we can reduce the special interest tax subsidies that force all Coloradans to pay an artificially high income tax rate, and provide additional income tax relief to all individuals and businesses in Colorado.

Progress on big challenges like eliminating special interest giveaways and passing the savings along to you doesn’t happen overnight or even in a year. My goal is to accomplish this by the end of my first term and truly deliver for the people of Colorado, not the special interests and their lobbyists. And some good news, for 2020 at least– and hopefully beyond– the income tax rate in Colorado is going down.
I also believe we must save more for a rainy day and put the tools in place to prepare our state to avoid draconian cuts duringthe next economic downturn.
Last year I asked the legislature to put an additional $180 million into savings to replenish what was spent in the Great Recession. Unfortunately, they only put an additional $40 million in reserve. This year I am once again urging the legislature to replenish our reserves so that we are ready for a downturn, whenever it comes.
Putting money in reserves that we could spend on so many pressing needs today is always a hard sell, but we can’t stand idly by and just wait for the next downturn without planning for inevitable economic cycles.
That’s why I strived to make fiscal responsibility easier for the legislature by asking my administration to scrub their budgets and find savings. And our budget identified over $238 million in savings. I hope the legislature will find this package compelling as we work with Treasurer Dave Young on a toolkit for future recession planning.
Expanding opportunities and tackling affordability in the face of Colorado’s rising cost of living is my focus for 2020 and beyond.
I want to look for new ideas to reduce your costs in healthcare, housing, taxes, and other barriers that stand in the way of success so that we can truly build a Colorado for All, in which hard-working Coloradans aren’t just struggling to get by, but are thriving in our amazing state.