Home » What’s News » Weekly Commentary » Colorado’s State of the State

Colorado’s State of the State

Our 2024 Legislature has just opened and is warming up to its usual fever pitch. Other States, however, are already rolling.  In Colorado, for example, Governor Jared Polis (D) recently delivered his State of the State address. It was unusual in that he is a Democrat Governor who was urging lawmakers to cut taxes.

Before going into what he said, here is a little background. Colorado has a state constitutional provision called the Taxpayer Bill of Rights, or TABOR for short. TABOR prevents lawmakers from increasing taxes beyond an objectively determined cost of living amount without a vote of the electorate. We previously wrote about how some lawmakers and others were trying to get TABOR declared unconstitutional, claiming that the unlimited ability to tax is a key component of a “republican form of government” each state is guaranteed under the U.S. Constitution. So far, the litigation has gone on for several years and TABOR is still alive and well.

So here is some of what Governor Polis said:

I know some Democrats in the past have been skeptical of reducing our income tax rate, but cutting the income tax rate is the most effective way to further our economic growth. In my 2020 state of the state address I echoed President Kennedy and President Obama’s calls for cutting the income tax rate, and the people of our state delivered twice. President Kennedy didn’t just launch the moonshot, he delivered one of the largest income tax cuts in history, saying that income taxes, “exerts too heavy a drag on growth [and] reduces the financial incentives for personal effort, investment, and risk-taking.” Those cuts helped spur America’s astronomic economic growth. 

. . . .

As demonstrated by our healthy [TABOR] surplus in Colorado, taxes are simply too high: income taxes, property taxes, and the state sales tax. We ignore that signal at our own peril and I challenge Democrats and Republicans to work together to improve our economic growth and success by not taking taxes we can’t keep from people and instead working on a bold, balanced, progressive package, including cutting the income tax rate. 

In the 2023 legislative session, as you may recall, Governor Green introduced legislation that would have given Hawaii families, especially ALICE (asset limited, income constrained, employed) families, tax relief. That legislation was amended beyond recognition in both the House and Senate to a bill that temporarily enhanced certain credits that are given to lower income families.  The Governor signed that bill anyway and said that his tax relief bill would be reintroduced this session.

That legislation is worth seriously reconsidering. One of the major drivers of state revenue, our General Excise Tax, has been described as a tax on “virtually every economic activity imaginable.”  The key phrase there is economic activity. If there’s no economic activity, the GET can’t produce revenue.  If too much tax puts the brakes on our economy, it becomes harder and harder to get the economy to encourage hard work, risk-taking, and investment and to generate jobs, innovation, and growth.

You don’t have to take my word for it. Colorado Governor Polis probably said it better than I could. He, in turn, cites the words and actions of former Democratic Presidents.

By the way, Colorado’s income tax rate is just a flat 4.4% in 2024.  We start taxing income at a greater rate once a married couple hits a mere $9,600 in taxable income, and the rate keeps climbing until it hits 11%.

So maybe it’s okay to be a Democrat and to work toward lowering our high tax rates here in Hawaii.

Print Friendly, PDF & Email
Follow Tom Yamachika:
President of the Foundation.
Latest posts from

Leave a Reply