COLORADO SPRINGS, Colo. (KOAA) — A four-bill tax package is making its way through the Colorado legislature. It consists of House Bill (HB) 1221, House Bill 1222, House Bill 1223, and House Bill 1289.
The bills tighten tax rules for businesses, and additional revenue from most would be put towards an expanded family affordability tax credit.
On Thursday, the Southern Colorado Women's Chamber of Commerce held a Colorado Tax Impact Forum. A panel of experts explained the tax package to local businesses and how, if passed, it would impact them.
Here's how Rhonda Sparlin, Colorado Chamber of Commerce Board and Chamber Tax Council member, summarized each bill:
HB 1221: Raises taxes by disallowing corporate executive wages and restricting the use of net operating loss deductions.
HB 1222: Delays the timing of business deductions for depreciation, interest expense, and research and development expenses.
HB 1223: Imposes state sales taxes to electronic downloads of software and SaaS.
HB 1289: Repeals “seldom used” tax provisions; but creates worldwide combined filingmethodology,eliminatesspace flight sales tax exemption, and tweaks Enterprise Zone Credits.
Kelly Eustace was one of more than two dozen people in attendance at the forum. She serves as principal owner and president of Heating & Plumbing Engineers, a generational business that has been based in Colorado Springs since 1947. Eustace believes the bills put an unfair burden on small businesses.
“I think if the bills are enacted, they make the tax filing for small businesses more complicated, creates additional administrative expenses that are unnecessary," Eustace said. "I think, most importantly, it de-incentivizes new businesses to come to Colorado.”
Art C. Klein Construction is another generational business in Colorado Springs. Director Diane Miller worries about the impact of HB 1223.
“We are very dependent on collaborative software with our subcontractors, with our owners we have contracts with," Miller said. "Will we be limited on licensing? Will we all still have our individual licensing? Really more about how I'll be able to work directly with my customers and sub-contractors."
Michelle Talarico is the owner of Picnic Basket Catering Collective in Colorado Springs. She says lately, the business climate has been especially tough for small businesses operating in Colorado.
"It's awfully hard to make the dollars and cents balance in your favor as a business owner," Talarico said. "Whether your business generates $10,000 a year or $10 million a year, we employ people that actually live here."
If passed, the bills would take effect as law on January 1, 2027.
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