JCBL NEWS UPDATE: CO Dept of Revenue to issue emergency sales tax rules Dec 1 with major impact on many JeffCo businesses
The Jefferson County Business Lobby wants to make sure that JeffCo businesses and chambers of commerce are aware of an important change the State of Colorado is implementing regarding the calculation of sales tax on shipped or delivered goods.
These rules could have a major impact on your business or those of your members. Below is background on the coming changes, as well as links to additional information. The JCBL would encourage you to contact the Department of Revenue and your state legislators with any concerns with these rules. Information about how to do that is below.
BACKGROUND
In September, all Colorado businesses that sell tangible goods within the state received notice of an emergency rule making by the Colorado Department of Revenue Taxation Division regarding a substantial change in the collection of sales tax. Previously, most businesses collected sales tax based on the location of the point of sale. Going forward, businesses will be required to collect state, county AND local sales tax based on the location of delivery.
Colorado has one of the most complicated sales and use tax systems in the entire country. With 383 overlapping cities, counties, and special districts, there are almost 700 different sales tax combinations. Most of the these can be remitted to the state, but 99 “home rule” municipalities collect their own taxes, so separate returns will need to be filed with them.
Beginning December 1, if you sell and deliver goods outside of the tax jurisdiction of your physical brick and mortar location, you will be required to register each of the nonphysical locations you sell into on the state’s database. You will also be required to apply for a sales tax license in each of these jurisdictions. The Department is granting an enforcement grace period until March 31, 2019.
These new sales tax rules were precipitated by a US Supreme Court ruling in June. South Dakota v. Wayfair permits states to require out-of-state retailers collect and remit state and local sales taxes. The Wayfair decision rested partly on the fact that South Dakota treated in state and out of state retailers equally in its rules. Colorado Department of Revenue is following suit and subjecting Colorado businesses to the same onerous rules that will apply to remote sellers.
ADDITIONAL RESOURCES
Here is a link to the Department of Revenue memo sent in September, as well as a Denver Post story explaining the issue.
- Department of Revenue Memo
- Denver Post: “Small businesses brace for Colorado’s new online sales tax rules some say could put them out of business”
PUBLIC COMMENT
The Department is holding a public rulemaking hearing on November 30th. If you are concerned about the impact of the new rules on your business, we encourage you to attend that meeting, and to call your state and local elected officials to register your concerns.
You can email comments to the Department of Revenue at dor_taxrules@state.co.us. The comments are due by November 30, 2018 at 5:00 p.m.
The JCBL encourages anyone to attend the hearing to raise concerns, as well. The details for that hearing are below.
Department of Revenue Rulemaking Hearing:
Date/Time: November 30, 2018 at 2:00 p.m.
Location: Department of Revenue, 1313 Sherman Street, Room 220, Denver, CO 80203
If you have contacted your legislator or the Department of Revenue, or have questions about the process, please let us know.
JCBL: 2018 Election Report
Jefferson County was the epicenter of last Tuesday’s electoral earthquake in Colorado. Democrats successfully parlayed broad dissatisfaction with Republican leadership in Washington, DC, into historic gains at the state level. The Jefferson County Business Lobby has been closely following races state-wide and wanted to get you this brief summary of the election results and what it means for Jefferson County’s business community.
Voter turnout in 2018 was about 25% greater than in the last midterm election of 2016. An energized Democratic base turned out and record levels of Unaffiliated voters (who surpassed both Democrats and Republicans for the first time) broke decisively for the Democrats.
While the story of the Democratic “Blue Wave” may be more mixed at the national level, there can be no doubt that wave hit Colorado. Governor-Elect Jared Polis and fellow Democrats won both branches of the State Legislature and all state-wide offices. The last time that happened was in 1936.
Here in Jefferson County, voters were bombarded by campaign advertising from three of the four most contested state legislative races in the state. The outcome of those elections determined control of the State Legislature, which had been under split partisan control for the last four years. Strong campaigns from State Rep. Brittany Petterson (D-Lakewood) and State Rep. Jessie Danielson (D-Golden), along with Conifer resident Tammy Story prevailed over well-funded Republican candidates – and by wide margins.
While most were focused on the State Senate races, the Blue Wave also propelled two former Republican JeffCo seats in the Democratic column. Brianna Titone edged out Vicki Pyne for a vacant Arvada House seat, while Lisa Cutter won another open seat in Evergreen. All told – pending ongoing recounts – House Democrats appear to have expanded their majority to 41 Democrat to 24 Republican seats.
While it was a great night for Democratic candidates in Colorado, interestingly, voters decisively rejected several ballot issues backed by center-left constituencies. A progressive income tax for education funding and severe restrictions on oil and gas development were both soundly defeated. Meanwhile, voters also rejected two competing and very different proposals to inject more funding into Colorado’s roads, sending a mixed signal on what voters would like done about one of our state’s most pressing needs.
Some of the most influential legislators at the Capitol serve JeffCo districts, like House Business Affairs Committee Chair Tracy Kraft-Tharp (D-Arvada) and Senator Rachel Zenzinger, newly appointed to the Joint Budget Committee. The JCBL will be continuing to communicate to them, and all of our delegation, the priorities of JeffCo businesses as important bills come up in 2019.
JCBL Legislative Update: Colorado’s 2019 budget to spend new revenue on transportation, PERA reforms and K-12
By Jeff Weist
Jefferson County Business Lobby
April 9, 2018
Unlike the U.S. Congress, Colorado’s state legislature must pass a balanced budget each year, as required by our state Constitution. Two full weeks of each 16-week legislative session is spent debating the coming year’s state budget, a process the legislature just completed. Here are some of the highlights of next year’s budget and how it will impact JeffCo’s business community.
Known as the “Long Bill”, the annual budget bill is written by the powerful Joint Budget Committee. While both the Republican Senate and Democratic House of Representatives added a large number of amendments to the bill over the last two weeks, the JBC will ultimately reject most of those. The state is in the unusual position of having extra tax revenue to spend, but both chambers of the legislature added enough amendments to the Long Bill to overspend even that new revenue.
Other than funding the state government for the coming year, the major new elements of the nearly $29 billion 2018-19 budget, as drafted by the JBC, were about $500 million for transportation, $225 million for reforms to the underfunded Public Employees Retirement Association (PERA) and $150 million in extra funding for K-12 schools.
Regarding the JCBL’s top 2018 priority of finding more funding for transportation, the legislature and the business community continue down a few different paths that are slowly coalescing. The only thing that everyone seems to agree on at this point is that $500 million of the state’s excess revenue should go to transportation projects next year. While that is more general funding for transportation than we have seen in a long time, it is still a small down payment on the $9 billion backlog of road projects facing the state.
Plans for funding transportation after next year are less clear. The Senate Republicans’ top transportation agenda item – SB18-001 – cleared the Senate unanimously after a bi-partisan deal spearheaded by Jefferson County’s own Senator Rachel Zenzinger (D-Arvada). That deal provides for $500 million next year and about $150 million each year after that, with a plan to ask voters in 2019 to issue bonds so more projects can be completed earlier. The fate of that deal, however, is uncertain as SB001 heads to the Democratic House of Representatives. The leadership there has expressed a desire to see more of that funding go to local governments for their own transportation, transit and mobility projects.
Meanwhile, two business groups are moving forward with competing plans to ask voters to raise either sales taxes or vehicle ownership taxes to provide new funding for state and local transportation projects. If the legislature adequately funds transportation during this session, or two competing tax hike proposals actually make it to the ballot, the success of either could be in doubt.
Just a reminder that you can find the status of all of the JCBL bills at jeffcobusinesslobby.org. While you are there, sign up for regular updates under the “Take Action” icon.
The Jefferson County Business Lobby is the united voice of JeffCo businesses at the Colorado State Capitol. The JCBL is a partnership comprised of the Arvada, Evergreen, Golden, West Metro, Westminster and Wheat Ridge Chambers of Commerce, the Jefferson County Economic Development Corporation and the Applewood and Wheat Ridge Business Associations.
JCBL Legislative Update: At the halfway mark, a tentative deal on new transportation funding.
By Jeff Weist,
Jefferson County Business Lobby
March 21, 2018
The 2018 session of Colorado’s state legislature has been a relatively slow one for major business issues so far, but that all changed this week when the state’s economists released their latest forecast for state tax revenue receipts. That number is important because most of the outstanding major issues left for Republican Senate and Democratic House to resolve – like more desperately-needed funding for transportation — depend on how much money is available to fund new priorities.
After more than a decade of tough years for the state legislature’s budget writers on the Joint Budget Committee, Colorado is facing an unusual rush of tax revenue this year due – ironically – to the federal tax reform bill recently enacted by the US Congress. In fact, the latest revenue estimates show state tax revenue to be up almost 13% for the current budget year.
That news set of a flurry of activity as legislators jockeyed to secure funding for not only transportation – a top JCBL priority – but also education, reform to underfunded state employee retirement system and many others.
It is still too early to know for sure, but the indications are encouraging that the state legislature will approve about $500 million dollars in one-time funding for transportation for the coming fiscal year. Both the Senate and the Joint Budget Committee have approved that amount. But a tentative bi-partisan deal in the Senate would also add another $250 million per year after that to pay for future bonding or maintenance. That is no where near enough to fill the estimated $9 billion backlog of road projects facing CDOT and our local communities statewide, but it is a decent start.
Jefferson County’s own State Senator Rachel Zenzinger play a key role in forging that bi-partisan deal. It now heads to the House of Representatives, where the leadership there has indicated a desire to spend more of the surplus on education rather than transportation.
The current version of SB18-001, the vehicle for this new transportation funding proposal, would not send the question to the voters of issuing bonds to front-load road construction projects. That was a priority for the Republicans, a question that would be put off for a year to see if the voters approve either of two proposed tax increases for road projects. One would increase the state sales tax from one-half to one percentage point, depending on which version the proponents push forward, while the other proposal would increase vehicle ownership taxes.
Just a reminder that you can find the status of all of the JCBL bills at jeffcobusinesslobby.org. While you are there, sign up for regular updates under the “Take Action” icon.
The Jefferson County Business Lobby is the united voice of JeffCo businesses at the Colorado State Capitol. The JCBL is a partnership comprised of the Arvada, Evergreen, Golden, West Metro, Westminster and Wheat Ridge Chambers of Commerce, the Jefferson County Economic Development Corporation and the Applewood and Wheat Ridge Business Associations.
JCBL Legislative Update: Four transportation funding measures filed for the November 2018 ballot
By Jeff Weist
Jefferson County Business Lobby
February 23, 2018
One of the Jefferson County Business Lobby’s top priorities for 2018, as in years past, is increasing the state’s investment in our transportation infrastructure. Colorado is amassing a transportation investment deficit of nearly $1 billion each year, and we are spending half as much on transportation, on a per-person basis, as we did 25 years ago. While transportation funding has also been a top priority for the Republican and Democratic leaderships in the State Legislature, finding bi-partisan compromise on how to achieve it has been hard.
As a result, a business-led bi-partisan coalition this week filed four similar ballot titles in the hopes of asking the voters this coming November for an increase in the state sales tax to fund roads. The coalition is led by the Denver Metro Chamber of Commerce and the Colorado Contractors Association, along with a number of local elected officials and community leaders.
According to the coalition, “These proposals increase the sales tax by point-five percent, point-six-two percent or one-point-zero percent, which amounts to just five to ten cents on a ten dollar purchase. A fourth proposal includes a point-five percent sales tax increase and requires the state to transfer $150 million from the general fund each year to state and local transportation projects. One proposal will ultimately be chosen to go forward, a decision that is dependent on the final amount that the state Legislature dedicates to transportation in this year’s budget.”
An expected surplus of state income tax revenue resulting from the recently-enacted federal tax reform bill has created an opportunity to dedicate some of that new revenue to transportation. The Republican and Democratic leaderships are in preliminary negotiations to determine how much, if any, of that surplus will go to roads.
While the four ballot initiatives filed this week vary in the amount of new revenue to be raised, all four would distribute those new dollars in the same manner. Forty-five percent would go to CDOT to address major projects like I-25 and I-70, and would be available to be bonded so the proceeds can be realized early and the work completed faster.
Forty percent of the new revenue would be split 50-50 among cities and counties, who would have flexibility to determine its best use.
And 15% would be spent by the state on multi-modal transportation options like mass transit, bike lanes, etc.
The tax increase would sunset after 20 years, the expected pay off of any bonds issued on the revenue.
The JCBL has not yet taken a position on any of these proposed ballot initiatives, but we will keep you updated.
Just a reminder that you can find the status of all of the JCBL bills at jeffcobusinesslobby.org. While you are there, sign up for regular updates under the “Take Action” icon. Lastly, please mark your calendars for the JCBL Day at the Capitol on March 6th from 8-11am.
The Jefferson County Business Lobby is the united voice of JeffCo businesses at the Colorado State Capitol. The JCBL is a partnership comprised of the Arvada, Evergreen, Golden, West Metro, Westminster and Wheat Ridge Chambers of Commerce, the Jefferson County Economic Development Corporation and the Applewood and Wheat Ridge Business Associations.
JCBL Legislative Update: JeffCo’s legislators are leading the way on the top business issues in 2018
By Jeff Weist
Jefferson County Business Lobby
February 12, 2018
As the Jefferson County Business Lobby reviews and takes formal positions on the most important business-related bills of the 2018 Colorado legislative session, we are proud to note that, once again, JeffCo’s own state legislators are playing leading roles on many of the JCBL’s top policy priorities.
Those priorities for the year include increased transportation funding, easing regulatory burdens to maintain a strong, competitive business environment and helping businesses attract and retain skilled employees through better education and an affordable housing supply.
(You can track the status of JCBL’s priority bills – and help the JCBL communicate those priorities to our legislators – by going to jeffcobusinesslobby.org and clicking on “Take Action” to sign up for legislative updates and alerts.)
Three efforts are underway to find a much needed increase in funding for transportation infrastructure. All eyes on are a potential ballot question in November that will ask voters to approve higher sales taxes for roads. Meanwhile, the Legislature will have to decide how much, if any, of an unexpected state revenue surplus will go to transportation. That decision won’t be made until late in the session. Also, the Senate Republican majority have made a proposal to dedicate a portion of state sales tax revenue to pay back $3.5 billion in road bonds their top legislative priority – SB001. JeffCo Rep. Tim Leonard and Sen. Tim Neville have introduced a similar measure (HB1119) and the JCBL is supporting both bills. In fact, we support an “all of the above” approach to road funding.
The JCBL has also been reviewing a large number of bills to help Colorado’s business train and retain skilled talent. For example, the JCBL is supporting bills creating tax credits for childcare expenses (HB1004), requiring more information be sent to high schoolers and their parents about college credit that can be earned in high school (HB1005 – JeffCo Rep. Brittany Petterson), and funding the construction of career and technical education facilities (HB1034).
Affordable housing for new and current employees is also a priority for the JeffCo business community. No new legislation addressing the construction litigation crisis in condos is expected, but the JCBL is supporting a bill to extend the existing low income housing tax credit (SB007), while opposing some misguided attempts such as imposing a tax on plastic bags (HB1054) and real estate transactions (SB006) to fund affordable housing.
The JCBL is also supporting a number of bills to reduce tax and regulatory burdens on businesses. A multi-year effort to simplify Colorado’s notoriously difficult sales tax system may take a major step forward with legislation to help create a state-wide simplified sales tax reporting system (HB1022, with an all-JeffCo lineup of sponsors – Representatives Lang Sias and Tracy Kraft-Tharp and Senators Cheri Jahn and Tim Neville).
Other pro-business bills supported by the JCBL include one to reduce business personal property taxes (HB1036 – Rep. Tim Leonard and Sen. Tim Neville); another to permit small businesses to “cure” minor regulatory paperwork infractions without a fine (HB1113 – Sen. Tim Neville); and, one to permanently extend the requirement that state regulators do a cost-benefit analysis before finalizing new regulations (HB1237 – Rep. Tracy Kraft-Tharp and Sen. Tim Neville).
Lastly, JeffCo legislators are also leading the charge on several economic development measures supported by the JCBL. Those include: reforming Colorado’s business income tax sourcing method to attract more national companies to Colorado (HB1185 – Rep, Tracy Kraft-Tharp and Sen. Tim Neville); extending the important Advanced Industry Export Acceleration program (HB1135 – Rep. Tracy Kraft Tharp); and, creating sales tax exemptions for on-demand air carriers important to our regional airport (HB1083 – Reps. Tracy Kraft-Tharp and Lang Sias)
Again, you can find the status of all of the JCBL bills at jeffcobusinesslobby.org. While you are there, sign up for regular updates under the “Take Action” icon. Lastly, please mark your calendars for the JCBL Day at the Capitol on March 6th from 8-11am.
The Jefferson County Business Lobby is the united voice of JeffCo businesses at the Colorado State Capitol. The JCBL is a partnership comprised of the Arvada, Evergreen, Golden, West Metro, Westminster and Wheat Ridge Chambers of Commerce, the Jefferson County Economic Development Corporation and the Applewood and Wheat Ridge Business Associations.
