HB 20-1427 Summary

• Ballot Issue: Refers $294 million annual tax increase to November 2020 statewide election for voter approval, with taxes on cigarettes, tobacco, and nicotine products

• Cigarette Tax: Incrementally increases cigarette tax from 6.5¢ per cigarette (Jan 2021) to 10¢ per cigarette (July 2027), with lower rates for modified risk tobacco products at half the standard rate

• Tobacco & Nicotine Taxes: Increases tobacco products tax from 30% to 42% of manufacturer's list price by July 2027; creates new tax on nicotine products (e-cigarettes/vaping) at equal rates, phasing up to 62% by July 2027

• Revenue Allocation: Directs new tax revenue to public schools, Colorado preschool program expansion, tobacco/nicotine reduction programs, rural school funding, housing assistance, and eviction legal defense

• Implementation: Creates inventory tax on cigarettes when tax rates increase; expands cigarette and tobacco taxes to out-of-state delivery sales; requires voter approval for provisions to take effect January 1, 2021