Economy of Colorado - State Taxes

State Taxes

The Colorado income tax rate is a flat 4.63 percent of federal taxable income regardless of income level. Colorado's state sales tax is 2.9 percent on retail sales. Full-year Colorado residents can claim an excess sales tax refund on their individual state income tax return. Many counties and cities charge their own rates in addition to the base state rate. There are also certain county and special district taxes that may apply. The most common special district taxes are:

• Regional Transportation District (RTD), which affects the counties of Denver, Boulder, Jefferson and portions of Adams, Arapahoe, Broomfield and Douglas
• Cultural Facilities District (CD)
• Football Stadium District (FD or FTBL), approved by the voters to pay for and help build the Denver Broncos’ stadium
• Local Improvement District (LID) within designated areas of southeast Jefferson and Boulder counties
• Regional Transportation District (RTA) taxes at varying rates in Basalt, Carbondale, Glenwood Springs, Gunnison County

Real estate and personal business property are taxable in Colorado. The state's senior property tax exemption was temporarily suspended by the Colorado Legislature in 2003. The tax break is scheduled to return for assessment year 2006, payable in 2007.