Companion measure would reduce income tax to 4.2% starting 2027 and preserve funding for education and health-care finance in first fiscal year, reviewers seek
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Summary
Proponents told reviewers April 4 Proposed Initiative 65 would lower Colorado’s individual and corporate income tax rates to 4.2% beginning in tax year 2027 and protect Department of Education and Health Care Policy and Finance funding from reductions in the first full fiscal year after implementation.
Proponents presented Proposed Initiative 65 in the same session as Initiative 64. Initiative 65 would reduce Colorado’s individual and corporate income tax rates from 4.4% to 4.2% beginning with the 2027 tax year, and expressly provide that any revenue reduction in the first full fiscal year following the tax-rate change shall not reduce funding for the Department of Education or the Department of Health Care Policy and Finance.
Reviewers pressed for drafting clarity. They asked whether the phrase "shall not reduce funding for the Department of Education or the Department of Health Care Policy and Finance" means the prohibition applies only during the single first full fiscal year after the effective date or beyond that period. Proponents indicated their drafting intent was to protect those departments from reductions in the first full fiscal year following implementation but acknowledged the need to clarify the scope and suggested conforming edits.
Staff also recommended consistent statutory phrasing so references to affected sections point to the statutory placement (the code section where the rate change will be enacted) rather than internal initiative section numbers that will not appear in the statutes. Proponents agreed to revise the language accordingly.
The hearing ended after technical comments; as with other sessions this day, the review was advisory and designed to help proponents refine language before circulation or filing.