Colorado tax amendment remains close

Colorado voters were still undecided on the state's most consequential tax question as of late Tuesday night. The race for Amendment 87 remained too tight to declare a winner with the majority of ballots still uncounted.

As of 11:36 p.m. Tuesday, 73% of votes had been counted. At that point, 50.6% of voters supported the measure while 49.4% opposed it. The gap is narrow enough that the final outcome could shift with remaining ballots.

The amendment proposes replacing Colorado's current 4.4% flat income tax with a graduated system. If approved, it would create six new tax brackets starting January 1, 2027. The lowest rate would be 3.7% on income up to $25,000. The highest rate would be 8.4% on income above $1 million.

The proposal would lower taxes on the first $100,000 of annual income. It would raise taxes on households and businesses earning more than approximately $500,000. The state estimates the new system would generate about $2 billion annually. That revenue would fund healthcare, public schools, and childcare.

For a household with $75,000 in taxable income, the new brackets would reduce the tax bill by $275 per year. A family earning $550,000 would pay $1,175 more annually. Someone earning $10 million would owe an additional $376,000. The same rate changes would apply to business profits.

Progressive advocacy groups backed the measure, arguing it addresses wealth inequality. They said the tax hike targets billionaires who are accumulating assets rapidly while the middle class struggles with costs. Conservative and business groups opposed the change. They argued the higher rates would increase financial pressure on companies and raise consumer prices during a difficult economic period.

The constitutional change is necessary because the state's Taxpayer's Bill of Rights, or TABOR, currently bans a graduated income tax. Amendment 87 would remove that prohibition and establish the new brackets. In a separate vote, Proposition 136 sought to block the higher rates by capping the state income tax at 4.4%. That measure was trailing with 52.9% opposition as of 11:40 p.m. Tuesday.

Voters in different parts of the state cited various reasons for their choices. Karen Vidana, a 22-year-old retail worker, voted yes in the Denver suburbs. She said the idea of taxes helping people was a compelling reason to support it. Jeff Wallace, a 67-year-old physician in Pagosa Springs, also voted in favor. He noted that the very wealthy can afford to pay more, despite concerns about how state officials might spend the money.