Tax Foundation: The state's combined rates are among higher than many.
No small business owner likes taxes, and Colorado has relatively high rates when it comes to its average combined state and local tax rates, according to a new report.
The Tax Foundation found that Colorado has the nation’s sixteenth highest average combined state and local sales tax rates at 7.63 percent. That ranks behind states such as No. 1 Tennessee (9.47 percent).
Last year, 39 counties raised their sales taxes.
“Retail sales taxes are one of the more transparent ways to collect tax revenue,” according to the report. “Sales taxes are easier to understand; consumers can see their tax burden printed directly on their receipts.”
NFIB State Director Tony Gagliardi recently told Colorado Watchdog.org that the state has one of the nation’s most complex sales tax systems. “Our biggest concern is the simplification of the current sales tax system we have,” he told the website.
What’s more, Colorado is among the five states with the highest average local sales tax rates at 4.73 percent, ranking third nationwide behind Alabama and Louisiana (5 percent).
But according to the Tax Foundation, high tax rates can push consumers toward neighboring tax environments. “Sales tax rate differentials can induce consumers to shop across borders or buy products online,” writes Janelle Cammenga, the report’s author.
For more information, visit https://taxfoundation.org/sales-tax-rates-2019
