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Colorado Proposition 121, State Income Tax Rate Reduction Initiative (2022)

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Colorado Proposition 121
Flag of Colorado.png
Election date
November 8, 2022
Topic
Taxes
Status
Approveda Approved
Type
State statute
Origin
Citizens

Colorado Proposition 121, the State Income Tax Rate Reduction Initiative, was on the ballot in Colorado as an initiated state statute on November 8, 2022. The measure was approved.

A "yes" vote supported decreasing the state income tax rate from 4.55% to 4.40% (including for domestic and foreign C corporations) for tax years commencing on or after January 1, 2022.

A "no" vote opposed decreasing the state income tax rate to 4.40%, thereby leaving in place the current rate of 4.55%.


Election results

Colorado Proposition 121

Result Votes Percentage

Approved Yes

1,581,163 65.24%
No 842,506 34.76%
Results are officially certified.
Source


Overview

What did Proposition 121 do?

See also: Ballot language and full text

Proposition 121 decreased the state income tax rate from 4.55% to 4.40% for tax years commencing on or after January 1, 2022. Proposition 121 was also designed to reduce the tax rate for domestic and foreign C corporations operating in Colorado from 4.55% of Colorado net income to 4.40%.[1]

Who supported and opposed Proposition 121?

See also: Campaign finance, Support, and Opposition

Jon Caldara of the Independence Institute and Republican State Senator Jerry Sonnenberg filed the initiative. The Independence Institute describes itself as a free-market think tank with a mission to "empower individuals and to educate citizens, legislators and opinion makers about public policies that enhance personal and economic freedom."[2]

Colorado Character registered as a committee to support the initiative. The committee raised $546,500 ($250,000 each from Colorado Rising Action and Defend Colorado, $45,000 from Coloradans for Civil Liberties, and $1,500 from Independence Institute). The committee reported expenditures totaling $545,130.[3]

Path 2 Zero registered to support Propositions 121, 124, 125, 126, and Amendment E; and registered to oppose Propositions 123, GG, FF, and Amendment F. It is impossible to distinguish between funds spent on each individual measure. The committee reported $10,430.70 in in-kind contributions from Independence Institute.[4]

Keeping Colorado Great registered as a committee to oppose the initiative. The committee reported $295,001 in contributions.[3]

Coloradans Coming Together registered to oppose Proposition 121 and support Proposition GG. The committee reported $95,841.86 in cash and in-kind contributions and $2,207.50 in cash expenditures.[3]

What is the history of the state income tax rate in Colorado?

See also: Colorado Proposition 116, Decrease Income Tax Rate from 4.63% to 4.55% Initiative (2020) and Colorado individual income tax rate history

In 2020, Colorado voters approved Proposition 116, also filed by Jon Caldara of the Independence Institute and State Sen. Jerry Sonnenberg (R). The initiative decreased the state income tax rate for individuals, estates, and trusts from 4.63% of federal taxable income to 4.55% for tax years commencing on and after Jan. 1, 2020. The measure also reduced the tax rate for domestic and foreign C corporations operating in Colorado from 4.63% of Colorado net income to 4.55%. It was approved by a vote of 57.86% to 42.14%.

Prior to 1987, the individual income tax rates in Colorado were graduated, meaning those with higher incomes paid higher tax rates and those with lower incomes paid lower rates. The Colorado individual income tax rate has been a flat tax rate since 1987. The flat tax was 5% from 1987 to 1998. It was lowered to 4.75% in 1999. The rate was 4.63% since 2000 until it was lowered to 4.55% in 2020 through voter approval of Proposition 116. According to the Colorado Legislative Council Staff, the rates were lowered to reduce the TABOR surplus.[5]


Text of measure

Ballot title

The ballot title for the initiative was as follows:[1]

Shall there be a change to the Colorado Revised Statutes reducing the state income tax rate from 4.55% to 4.40%?[6]

Full text

The full text of the ballot initiative is below:[1]

Readability score

See also: Ballot measure readability scores, 2022

Using the Flesch-Kincaid Grade Level (FKGL) and Flesch Reading Ease (FRE) formulas, Ballotpedia scored the readability of the ballot title for this measure. Readability scores are designed to indicate the reading difficulty of text. The Flesch-Kincaid formulas account for the number of words, syllables, and sentences in a text; they do not account for the difficulty of the ideas in the text. The state board wrote the ballot language for this measure.

The FKGL for the ballot title is grade level 9, and the FRE is 62. The word count for the ballot title is 18.


Support

Jon Caldara of the Independence Institute and Republican State Senator Jerry Sonnenberg filed the initiative.[1]

Supporters

Officials

Organizations

  • Coloradans for Civil Liberties
  • Colorado Rising Action
  • Defend Colorado
  • Independence Institute

Arguments

  • Ben Murrey, Fiscal Policy Center director of the Independence Institute: "Coloradans need immediate relief. ... Policymakers created the mess we find ourselves in now. More money remaining in the private sector means more investment in our communities and local economies. With it, the economy will grow and catch up with the expansion in the money supply, making it easier for everyday Coloradans to afford the 'new normal' prices brought on by government. ... Reducing the income tax will equip hardworking Americans to clean up after them. Allow Colorado families and businesses to keep more of what they earn, and they will strengthen the economy."


Official arguments

The following is the argument in support of the measure found in the Colorado Blue Book:[7]

  • Colorado Blue Book Official Arguments: "1) The state government currently collects more taxes than it uses for the programs it funds, and, in fact, more tax money than it is legally allowed to spend. By permanently lowering the tax rate, Proposition 121 cuts out the inefficiency of sending money to the government that just gets returned, while providing taxpayers with tax relief during future economic downturns. Families and businesses are better off when they can keep more of their own money. 2) There is no better time to cut the tax rate. The measure is a modest change that, according to the state’s own forecasts, won’t change the amount of money available for state spending for at least the next three years. The state legislature just approved the largest budget in state history and the budget is only expected to grow, even with the tax decrease under Proposition 121."

Opposition

Individuals

  • Scott Wasserman - President of the Bell Policy Center and the Bell Action Network


Arguments

  • Scott Wasserman, president of the Bell Policy Center and the Bell Action Network: "This November, you’re going to be asked once again if you want to lower your income taxes. It will be a simple proposition. Do you want to pay less? Hidden from that question will be the consequences for our schools, health, and public safety. In truth, the consequences are real. It’s a bait and switch. Those with huge incomes save a bunch, and the rest of us end up paying more in sales, property, and sin taxes. As you get ready to think about the 2022 ballot, ask yourself if the Coloradans of 1992 had any idea of what our world would look like. And more importantly, ask yourself if year after year of taxpayer whiplash is the future you want for Colorado?"
  • Bell Policy Center: "[The initiative] would actually undo the small step Colorado has taken toward a fairer tax structure [and] benefit the wealthiest Coloradans."


Official arguments

The following is the argument in opposition to the measure found in the Colorado Blue Book:[8]

  • Colorado Blue Book Official Arguments: "1) Most of the measure’s benefits will go to a small population of very wealthy taxpayers, including corporations. About 75 percent of taxpayers will receive a tax cut of less than $63 per year. Comparatively, those with incomes over $1 million, representing less than 1 percent of taxpayers, will receive nearly half of the total tax savings from the measure. On average, these taxpayers are expected to save almost $7,000 per year. In addition, corporations outside of Colorado will keep more money, which they may choose to invest elsewhere or pay as profits to out-of-state shareholders. 2) High inflation, the ongoing pandemic, and chaotic international relations have elevated the risk of an economic recession. If a recession occurs, the measure will likely reduce the amount of money available for the state budget, making it harder for the state to respond to economic challenges and provide critical services to those most impacted. Now is not the time to weaken the state’s safety net."

Media editorials

See also: 2022 ballot measure media endorsements

Ballotpedia lists the positions of media editorial boards that support or oppose ballot measures. This does not include opinion pieces from individuals or groups that do not represent the official position of a newspaper or media outlet. Ballotpedia includes editorials from newspapers and outlets based on circulation and readership, political coverage within a state, and length of publication. You can share media editorial board endorsements with us at editor@ballotpedia.org.

Support

  • Denver Gazette and Colorado Springs Gazette Editorial Boards: "Both candidates for Colorado governor rightly have called for eliminating the state income tax. Prop. 121 would take us a step in that direction, lowering the Colorado’s income tax rate for individuals and corporations from 4.55% to 4.40%."


Opposition

  • Durango Herald Editorial Board: "Those earning $1 million or more will receive almost half the total tax savings – an average of about $7,000. A reduction of 0.15% means a savings of $47 for those making $40,000 to $50,000, and $89 for those making $70,000 to $1,000,000. Not a lot, in other words. Better to retain the 4.55% rate and make refunds, if required."
  • Denver Post Editorial Board: "There is no need for Colorado voters to reduce the income tax rate because TABOR does it automatically for them. ... Furthermore, the 'no' on Proposition 121 campaign has hit the nail on the head with advertisements showing pretend millionaires gloating about how much money they will save with this permanent reduction from 4.55% to 4.4%, while Coloradans with median income levels or lower, will likely receive less than $100. There is no upside – other than relatively small tax savings — for the vast majority of Coloradans to further cut state revenue and state services at a time when we need our government to be providing essential services."
  • Sentinel Colorado Editorial Board: "The TABOR amendment prevents the state from controlling the tax part of the budget, which has wrought havoc in Colorado since the hair-brained scheme was adopted. As we’ve frequently pointed out, it’s an idea so bad that in more than three decades, no other state anywhere has taken it on. All this ballot measure does is help make rich Coloradans richer, deplete state funds and hand suckers who helped approve it next to nothing for their trouble. Vote no on this scam."


Campaign finance

See also: Campaign finance requirements for Colorado ballot measures
The campaign finance information on this page reflects the most recent scheduled reports that Ballotpedia has processed, which covered through December 8, 2022.


Colorado Character registered as a committee to support the initiative. The committee raised $546,500 ($250,000 each from Colorado Rising Action and Defend Colorado, $45,000 from Coloradans for Civil Liberties, and $1,500 from Independence Institute). The committee reported expenditures totaling $545,130.[3]

Path 2 Zero registered to support Propositions 121, 124, 125, 126, and Amendment E; and registered to oppose Propositions 123, GG, FF, and Amendment F. It is impossible to distinguish between funds spent on each individual measure. The committee reported $10,430.70 in in-kind contributions from Independence Institute.[9]

Keeping Colorado Great registered as a committee to oppose the initiative. The committee reported $295,001 in contributions and $293,328.32 in expenditures.[3]

Coloradans Coming Together registered to oppose Proposition 121 and support Proposition GG. The committee reported $95,841.86 in cash and in-kind contributions and $2,207.50 in cash expenditures.[3]

Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Support $546,500.00 $42,256.12 $588,756.12 $545,129.49 $587,385.61
Oppose $305,002.00 $85,840.86 $390,842.86 $295,535.82 $381,376.68
Total $851,502.00 $128,096.98 $979,598.98 $840,665.31 $968,762.29

Support

The following table includes contribution and expenditure totals for the committees in support of Proposition 121.

Committees in support of Proposition 121
Committee Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Colorado Character $546,500.00 $0.00 $546,500.00 $545,129.49 $545,129.49
Americans for Prosperity Colorado Issue Committee $0.00 $31,825.42 $31,825.42 $0.00 $31,825.42
Path 2 Zero $0.00 $10,430.70 $10,430.70 $0.00 $10,430.70
Total $546,500.00 $42,256.12 $588,756.12 $545,129.49 $587,385.61

Donors

The following table includes the top donors to the support committees.

Donor Cash Contributions In-Kind Contributions Total Contributions
Colorado Rising Action $250,000.00 $0.00 $250,000.00
Defend Colorado $250,000.00 $0.00 $250,000.00
Coloradans for Civil Liberties $45,000.00 $0.00 $45,000.00
Independence Institute $0.00 $8,923.96 $8,923.96
Independence Institute $1,500.00 $0.00 $1,500.00

Opposition

The following table includes contribution and expenditure totals for the committee in opposition to Proposition 121.[3]

Committees in opposition to Proposition 121
Committee Cash Contributions In-Kind Contributions Total Contributions Cash Expenditures Total Expenditures
Keeping Colorado Great $295,001.00 $0.00 $295,001.00 $293,328.32 $293,328.32
Coloradans Coming Together $10,001.00 $85,840.86 $95,841.86 $2,207.50 $88,048.36
Total $305,002.00 $85,840.86 $390,842.86 $295,535.82 $381,376.68

Donors

The following table includes the top donors to the opposing committees.[3]

Donor Cash Contributions In-Kind Contributions Total Contributions
NEA $250,000.00 $0.00 $250,000.00
Colorado Fund for Children and Public Education $45,000.00 $0.00 $45,000.00


Methodology

To read Ballotpedia's methodology for covering ballot measure campaign finance information, click here.

Background

Proposition 116 of 2020

See also: Colorado Proposition 116, Decrease Income Tax Rate from 4.63% to 4.55% Initiative (2020)

In 2020, Colorado voters approved Proposition 116, also filed by Jon Caldara of the Independence Institute and State Senator Jerry Sonnenberg (R). The initiative decreased the state income tax rate for individuals, estates, and trusts from 4.63% of federal taxable income to 4.55% for tax years commencing on and after January 1, 2020. The measure also reduced the tax rate for domestic and foreign C corporations operating in Colorado from 4.63% of Colorado net income to 4.55%. It was approved by a vote of 57.86% to 42.14%.

Two committees led the campaign in support of Proposition 116 in 2020: Energize our Economy (306 Real Fair Tax) and Americans for Prosperity Colorado Issue Committee. Together, the committees reported $1.55 million in contributions. The top three donors (which gave 99.64% of the total contributions) were Unite for Colorado, Independence Institute, and Colorado Rising State Action. Protect Colorado's Recovery and Fair Tax Colorado registered to oppose the measure. The committees reported $3.19 million in contributions. The top donor was the North Fund, which provided $750,000.[10]

Colorado individual income tax rate history

Prior to 1987, the individual income tax rates were graduated, a tax system in which different rates are applied to different levels of income. The Colorado individual income tax rate has been a flat tax rate since 1987. The flat tax was 5% from 1987 to 1998. It was lowered to 4.75% in 1999. The rate was 4.63% until voters approved Proposition 116 in 2020, which reduced the rate to 4.55%. According to the Colorado Legislative Council Staff, the rates were lowered to reduce the TABOR surplus.[5]

The following table shows the history of Colorado's individual income tax rates.[5]

Colorado individual income tax revenue

The following table shows income tax revenue in Colorado from 1999-2000 through 2019-2020.[5]

Colorado corporate income tax rate history

In Colorado, C corporations must pay a tax on the Colorado net income. The following table shows the history of Colorado's corporate income tax rates since the corporate income tax was enacted in 1937. The corporate income tax rate was a flat rate of 4% from 1937 to 1946. The rate was a flat rate of 5% from 1947 to 1980. From 1981 to 1993, the rates were graduated. From 1993 to 1998, the rate was returned to a flat rate of 5%. The flat rate was decreased to 4.75% in 1999 and to 4.63% in 2000.[11]

Colorado corporate income tax revenue

The following table shows the history of Colorado's corporate income tax revenue from 1999-2000 to 2019-2020.[11]

State income tax structures and rates

Colorado statewide ballot measures during even-numbered election years, 2000-2020

A total of 105 measures appeared on the statewide ballot in Colorado during even-numbered election years in the 20-year period between 2000 through 2020. Of the 105 measures, 48 were approved (45.71%) and 57 were defeated (54.29%). From 2000 through 2020, the number of measures on the even-year ballot ranged from three to 14.

Colorado statewide ballot measures during even-numbered election years, 2000-2020
Years Total number Approved Percent approved Defeated Percent defeated Annual average Annual median Annual minimum Annual maximum
2000-2020 105 48 45.71% 57 54.29% 10 10 3 14


Reports and analyses

Note: The inclusion of a report, white page, or study concerning a ballot measure in this article does not indicate that Ballotpedia agrees with the conclusions of that study or that Ballotpedia necessarily considers the study to have a sound methodology, accurate conclusions, or a neutral basis. To read a full explanation of Ballotpedia's policy on the inclusion of reports and analyses, please click here.

The Common Sense Institute published a report on Proposition 121 in August 2022. The Common Sense Institute describes itself as "a non-partisan research organization dedicated to the protection and promotion of Colorado’s economy" with a mission to "examine the fiscal impacts of policies, initiatives, and proposed laws so that Coloradans are educated and informed on issues impacting their lives [by employing] rigorous research techniques and dynamic modeling to evaluate the potential impact of these measures on the Colorado economy and individual opportunity."[12]



The full report can be read here.

Path to the ballot

See also: Signature requirements for ballot measures in Colorado and Laws governing the initiative process in Colorado

The state process

In Colorado, the number of signatures required to qualify an initiated state statute for the ballot is equal to 5 percent of the total number of votes cast for the office of Colorado secretary of state in the preceding general election. State law provides that petitioners have six months to collect signatures after the ballot language and title are finalized. State statutes require a completed signature petition to be filed three months and three weeks before the election at which the measure would appear on the ballot. The Constitution, however, states that the petition must be filed three months before the election at which the measure would appear. The secretary of state generally lists a date that is three months before the election as the filing deadline.

The requirements to get an initiated state statute certified for the 2022 ballot:

The secretary of state is responsible for signature verification. Verification is conducted through a review of petitions regarding correct form and then a 5 percent random sampling verification. If the sampling projects between 90 percent and 110 percent of required valid signatures, a full check of all signatures is required. If the sampling projects more than 110 percent of the required signatures, the initiative is certified. If less than 90 percent, the initiative fails.

Details about this initiative

  • Jon Caldara and Jerry Sonnenberg filed the initiative on April 9, 2021. Ballot language was provided for the initiative on April 21, 2021.[1]
  • The measure was cleared for signature gathering on June 21, 2021, with a signature due date of October 29, 2021.[1]
  • Proponents submitted 215,365 signatures on October 29, 2021. On November 18, 2021, the Colorado Secretary of State found through a random-sample method that 148,189 signatures were projected to be valid.[13]

How to cast a vote

See also: Voting in Colorado

Click "Show" to learn more about voter registration, identification requirements, and poll times in Colorado.

See also

External links

Footnotes

  1. 1.0 1.1 1.2 1.3 1.4 1.5 Colorado Secretary of State, "Initiative filings," accessed November 18, 2021
  2. Independence Institute, "Home," accessed November 12, 2021
  3. 3.0 3.1 3.2 3.3 3.4 3.5 3.6 3.7 Cite error: Invalid <ref> tag; no text was provided for refs named finance
  4. Colorado TRACER, "Path 2 Zero," accessed November 1, 2022
  5. 5.0 5.1 5.2 5.3 Colorado Legislative Council Staff, "Individual Income Tax," accessed August 14, 2020
  6. 6.0 6.1 6.2 6.3 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
  7. Colorado Secretary of State, "Official Voter Information Guide," accessed October 28, 2022
  8. Colorado Secretary of State, "Official Voter Information Guide," accessed October 28, 2022
  9. Colorado TRACER, "Path 2 Zero," accessed November 1, 2022
  10. Colorado Secretary of State TRACER, "Campaign finance committee search," accessed August 4, 2020
  11. 11.0 11.1 Colorado Legislative Council Staff, "Corporate Income Tax," accessed August 25, 2020
  12. [https://commonsenseinstituteco.org/wp-content/uploads/2022/08/CSI_CO_REPORT_PROP-121_FINAL.pdf Common Sense Institute, "2022 Colorado State Ballot Proposition #121," accessed September 21, 2022]
  13. Colorado Secretary of State, "Proposed Initiative #31 (“State Income Tax Rate Reduction”) Qualifies For 2022 General Election Ballot," accessed November 18, 2021
  14. Colorado Secretary of State, "Mail-in Ballots FAQs," accessed August 6, 2025
  15. LexisNexis, "Colorado Revised Statutes, § 1-7-101," accessed August 6, 2025
  16. 16.0 16.1 Colorado Secretary of State, "Voter Registration FAQs," accessed August 6, 2025
  17. 17.0 17.1 Colorado Secretary of State, "Colorado Voter Registration Form," accessed August 6, 2025
  18. Colorado Secretary of State, "Go Vote Colorado," accessed August 6, 2025
  19. Under federal law, the national mail voter registration application (a version of which is in use in all states with voter registration systems) requires applicants to indicate that they are U.S. citizens in order to complete an application to vote in state or federal elections, but does not require voters to provide documentary proof of citizenship. According to the U.S. Department of Justice, the application "may require only the minimum amount of information necessary to prevent duplicate voter registrations and permit State officials both to determine the eligibility of the applicant to vote and to administer the voting process."
  20. Colorado Secretary of State, "Acceptable Forms of Identification," accessed August 6, 2025