Bills would limit subsidies for the wealthiest individuals and largest corporations to provide tax assistance to hardworking Coloradans and small businesses DENVER, CO– The House Finance Committee today advanced legislation that would provide economic assistance to hardworking families and small businesses. The two bills boost the state Earned Income Tax Credit, fund the state Child Tax Credit, and raise the exemption for business personal property taxes by limiting loopholes for the wealthiest individuals and largest corporations.
“We have a choice to make–we can create a fair tax system that supports the families, workers and small businesses who are being left behind in our recovery, or we can continue outdated and ineffective tax windfalls for the wealthiest individuals and most profitable corporations,” said Rep. Emily Sirota, D-Denver. “Low wage workers and small businesses are falling behind as special interests protect their ineffective and outdated tax subsidies. As we emerge from this pandemic, we have to do everything possible to help all Coloradans recover as quickly as possible and build back stronger.”
“This pandemic and recovery have not treated all Coloradans the same; the wealthy and largest businesses have fully recovered as middle and lower-income workers are falling behind,” said Rep. Mike Weissman, D-Aurora. “Colorado’s billionaires grew their wealth by $10 billion since the pandemic began. We can either create a fairer tax code that lowers taxes on small businesses and increases assistance to hardworking families, or we can continue outdated loopholes that only benefit a few of the most prosperous corporations and wealthiest individuals. The choice is clear to me.”
HB21-1311 would boost the incomes of over 300,000 hardworking Coloradans by increasing the state Earned Income Tax Credit (EITC) to 20 percent of the federal credit and by funding the state’s Child Tax Credit, which was created in 2013, but has never been funded. In order to provide this relief, the bill closes loopholes primarily used for tax avoidance or which only benefit three-tenths of a percent of the wealthiest tax filers, such as eliminating at the state level business meals deduction expanded by the Federal Tax Cuts and Jobs Act and requiring filers to report financial accounts held in foreign tax shelters.
HB21-1312 would eliminate business personal property taxes (BPPT) for over two-thirds of the businesses that remit BPPT. Currently, businesses with under $7,900 in business personal property do not have to pay BPPT. The bill increases this exemption to $50,000. In addition to providing an important tax cut to tens of thousands of small businesses, raising the exemption means businesses will no longer have to complete and submit burdensome paperwork needed to claim the BPPT exemption. In order to provide this relief, the bill modifies ineffective tax subsidies for the largest businesses, such as strengthening the criteria insurance companies must meet in order receive a 50 percent discount on their insurance premium tax rate.
Many of the tax expenditures that these bills seek to close or limit have been identified by the State Auditor as ineffective and only benefit a small number of businesses and Colorado’s wealthiest residents. The bills seek to narrow expenditures that benefit only a few individuals and large businesses in order to provide broad tax relief to large numbers of hardworking Coloradans and small businesses.
For fact sheets or to learn more about the bills visit taxjustice.co