Proposition 136: Income Tax Rate Cap

What does Proposition 136 do?

The measure limits the state income tax rate for individuals and corporations to the current rate of 4.4 percent of taxable income beginning on January 1, 2027.

Does Proposition 136 change the current income tax rate?

No, the measure does not alter the current 4.4 percent state income tax rate. It creates a state law setting this rate as the maximum beginning on January 1, 2027.

Does Proposition 136 prevent any future changes to the state income tax rate?

No, Proposition 136 will not change the process for adjusting Colorado's income tax rate. The state legislature or a citizen initiative may reduce the state income tax rate. The Colorado Constitution already requires that any tax rate increases be approved by voters.

What happens if Proposition 136 and Amendment 87 both pass?

Amendment 87 creates a graduated income tax, where higher tax rates are applied to higher incomes and lower tax rates are applied to lower incomes earned by a household or business. If both Amendment 87 and Proposition 136 are approved by voters, the proposed rate for incomes over $500,000 in Amendment 87 would be higher than the 4.4 percent limit in Proposition 136. Generally, when parts of voter-approved measures conflict, the policy outcome is determined by the measure that receives more votes. However, if both measures are approved by voters, the exact outcome is unclear. The state legislature or a court will determine how to resolve any conflicts.