For any citizen-initiated measure that changes the state income tax rate, Proposition GG requires a tax information table to be included on the ballot and on the petitions circulated to voters. The table must list the average change in taxes owed for taxpayers in eight specific income categories.
The Colorado General Assembly put Proposition GG on the ballot as a referred measure by passing Senate Bill 22-222. This bill passed on straight party-line votes in both the House and Senate, with all Democrats voting in favor and all Republicans in opposition. Prop GG is a statutory measure, not Constitutional, so it would pass with a simple majority vote.
Below, there is an example of the categories people would see on their ballot and petitions into the future on income tax measures if Prop GG passes. Numbers aren’t filled in because they would depend on the ballot measure that’s being proposed.
In Colorado, income tax is a flat rate – that is, people in the highest earning categories would pay the same percentage rate on the federal taxable income line of their state tax return as lower earners. Of course, some lower income earners might find themselves owing no income tax at all at tax time if deductions put them below the threshold. If Prop GG passes, all voters would be able to see information on ballots and petitions showing how higher income earners would get a larger tax benefit in real dollars than lower earners – but whether this is a good idea or not is up to this year’s voters.
For More Information
Read the full ballot title, legislative text, and/or ballot measure analysis in your Colorado Blue Book, either through the hard copy most Coloradans get in the mail, or at https://leg.colorado.gov/content/initiatives/initiatives-blue-book-overview/ballot-information-booklet-blue-book
Pro:
- Prop GG will give voters information about the impacts of an income tax change that they deserve to know.
- Flat-rate income tax decreases benefit higher income earners to a much greater amount than lower income earners, and now voters can see this up-front on ballots and petitions.
- Many people sign petitions without really knowing the details about what they’re signing, and under Prop GG people would at least be able to see the chart before signing or declining to sign.
Con:
- Prop GG would make the physical ballots longer, by adding a sizeable chart, when today an income tax ballot measure like this year’s Prop 121 would just include a ballot title.
- It might become more difficult to pass an income tax decrease, even if it’s a good idea in other ways, because the chart would show greater benefits for higher income earners.
Richard’s Take
Vote “yes.” It provides voters with information they deserve to know, and that includes how flat-rate changes to income tax rates can be extremely regressive – benefiting higher income earners far more than lower income earners.
For income tax measures proposed in Colorado to this date, voters who read only the ballot title might have only seen limited information, such as the tax rate percentage changes, the total fiscal impact if it’s a tax increase, and a policy reason for the rate change if there is one (example, if an increase is to fund K-12 education).
For a relevant example, the ballot title for this year’s Proposition 121 (formerly Initiative 31) simply reads: “A change to the Colorado Revised Statutes reducing the state income tax rate from 4.55% to 4.40%.” Even the statutory text of Initiative 31 does not mention fiscal impact, or how the measure would affect taxpayers in different earning categories.
Proposition GG would give voters who only read ballot titles the opportunity to see Colorado’s regressive income tax policy up close. For Prop 121, which won’t have a chart on the ballot because Prop GG hasn’t passed yet, a chart would obviously show voters that higher-income earners would save a far larger dollar amount than lower-income earners. Here’s a chart on Prop 121 from the Blue Book, which shows different categories than Prop GG and has 12 income brackets instead of the 8 required under Prop GG, but you can see how lowest-earning categories would only get a $7 tax break, while the highest category would average $6,647.
Of course, voters who do more than read ballot titles already have the opportunity to look at tax charts that they’ll get in the Colorado Blue Book, on websites, on social/traditional media, or from policy centers. But some significant percentage of voters won’t take the time to research issues, and at the bare minimum Prop GG puts this information before voters at least once before they mark their ballots, potentially twice if they sign or decline to sign a petition.
Even armed with information about a regressive tax structure, some voters might still choose to vote on a measure just because they’ll get a tax break. That’s perfectly legal, and it’s rational behavior even if it might be short-sighted in some cases. But at least voters should have had an opportunity to have seen the information before voting.
I also like the requirement that charts be included with petition forms. Too many people do exactly zero research before signing a petition, and even though Prop GG might not get everyone to consider what they’re signing, again they’ll have the opportunity to learn more because petition gatherers often won’t volunteer information that might lead a potential petition signer to think twice.
