Initiative 195 would replace Colorado’s 4.4% flat tax with rates up to 8.4%

DENVER — Proponents of Colorado Initiative 195 filed petition signatures with the Colorado Secretary of State on August 3, 2026, the filing deadline for the November 3 ballot. The campaign reported turning in roughly 157,000 signatures against the 124,238 the state requires, and the official ballot title tells voters that state taxes would be increased $2.7 billion annually.

The measure would replace Colorado’s statutory 4.4 percent flat income tax with six graduated brackets starting in tax year 2027, and it clears the way by striking language from the Taxpayer’s Bill of Rights requiring all taxable net income to be taxed at one rate. The Secretary of State has until September 2 to issue a statement of sufficiency, so Initiative 195 carries no ballot number and no proposition or amendment letter until then.

Six marginal brackets would take effect in tax year 2027

The text filed with the Secretary of State sets rates of 3.7 percent on taxable income up to $25,000, 4.2 percent from $25,001 to $100,000, 4.4 percent from $100,001 to $500,000, 7.4 percent from $500,001 to $750,000, 7.9 percent from $750,001 to $1 million, and 8.4 percent above $1 million. The same schedule would apply to corporate income. The first two bands sit below today’s 4.4 percent rate, so the first $100,000 of any filer’s taxable income would be taxed less than it is now, and gain on the sale of a principal residence above the federal exclusion would stay at 4.4 percent.

Those are marginal rates, applying only to the slice of income inside each band. The Legislative Council Staff fiscal impact statement works an example: “a taxpayer with taxable income of $600,000 would pay a tax of 3.7 percent on the taxpayer’s first $25,000 in taxable income, 4.2 percent on the next $75,000, 4.4 percent on the next $400,000, and 7.4 percent on the last $100,000.”

The constitutional half of the measure deletes words and adds none. Article X, Section 20(8)(a) now requires that any income tax law change after July 1, 1992 “shall also require all taxable net income to be taxed at one rate.” Initiative 195 would strike “at one rate” and the surrounding tax-credit language, leaving a sentence that requires taxable net income to be taxed with no added surcharge. The newsroom covered both November measures in June.

Legislative Council Staff estimates $1.98 billion a year by fiscal 2027-28

The state’s nonpartisan analysts put the increase at $963.2 million in fiscal 2026-27 and $1,981.1 million in fiscal 2027-28. The $2.7 billion in the ballot question is the maximum those analysts estimated for fiscal 2027-28 once forecast error is allowed for. For scale, Joint Budget Committee staff put fiscal 2026-27 General Fund operating appropriations at $17.4 billion, out of $20.3 billion in total General Fund available.

The same official title carries a Board-adopted table of the estimated change in average income tax owed by category. It shows average tax falling in every category up to $1 million, including $325 for filers between $500,001 and $1 million, and rising above that, by $4,764 for filers between $1 million and $2 million and by $13,914 for those between $2 million and $5 million.

The new money would be exempt from the TABOR revenue cap as a voter-approved revenue change, so none of it would be refunded. Most would flow into an account the measure creates for K-12 education, health care, and early child care, and the text requires those dollars to add to current appropriations.

Signatures must reach 2 percent of registered electors in all 35 senate districts

Initiative 195 also faces a distribution test, because it amends the constitution. The Secretary of State’s signature requirement page requires a constitutional initiative to be signed by at least 2 percent of the registered electors in each of Colorado’s 35 state senate districts. The Colorado Sun reported on August 1 that the campaign had cleared 23 of the 35 districts as of July 30, a count the campaign gave the paper.

No official count exists, since the state does not publish raw totals and the petition stays sealed until the sufficiency statement issues. Colorado Politics reported that backers filed with about an hour left before the 5 p.m. deadline, and Protect Colorado’s Future, the coalition behind the measure, says on its site that it submitted nearly 160,000 signatures. Campaign-side counts reported since the filing have ranged from about 157,000 to about 163,000, and no official number will exist until the sufficiency statement issues.

Title Board found the measure does not require a 55% majority

Colorado normally requires 55 percent approval to amend the constitution. According to the Secretary of State’s results page, the Title Board entered the same finding at its January 21, 2026 hearing and again at the February 4 rehearing: “The Board finds that the proposed initiative only repeals, in whole or in part, a provision of the state constitution and therefore does not require a 55% majority for passage.”

Pfiffner says the upper brackets reach farms, ranches and medical practices

Penn Pfiffner, chairman of the TABOR Foundation and a Colorado state representative from 1993 through 2000, discussed the filing on The Kim Monson Show on August 7. “The Taxpayers Bill of Rights came about because government was growing twice as fast as people’s ability to afford it,” Pfiffner said, and the remedy was that “you’ve got to come to the people and get their permission.”

Pfiffner said the single-rate sentence is the protection at stake. “The taxpayers bill of rights has a provision in there that says all income must be taxed at one rate,” he said. “What these proponents are doing, what this measure does is eliminate some of that language.”

He also argued that the higher rates would reach far beyond large corporations and wealthy individuals. “But this applies to all the income in Colorado,” Pfiffner said. “So think of how many family farms this is going to affect and ranches. Think of how it’s going to affect professional groups like your dentist or your doctor’s office. Think of how it’s going to affect independent businesses.” He pointed listeners to Your Family’s Future Alliance, the issue committee opposing both Initiative 195 and Proposition NN, and has made the same case before.

Initiative 232 would cap Colorado’s income tax at 4.4 percent

A competing measure backed by Advance Colorado would write the 4.4 percent rate into statute as a cap on individual and corporate income tax, and the group said it submitted 190,000 signatures. When two measures pass and conflict, Colorado law gives control to whichever draws more affirmative votes.

The consequences are contested, and Colorado Politics reported the two campaigns giving opposite answers. Chris deGruy Kennedy, who leads the Bell Policy Center and is a designated proponent of Initiative 195, says the tax increases and the tax cuts are not severable, so a win by Initiative 232 would leave none of Initiative 195 in effect. Michael Fields, president of Advance Colorado, says the lower rates would survive. “It isn’t all or nothing,” Fields said. No court has yet ruled, and the newsroom has examined the conflict in earlier coverage.