Amendment 87: Graduated Income Tax
On every Colorado ballot · November 3, 2026
The question on your ballot
SHALL STATE TAXES BE INCREASED $2.7 BILLION ANNUALLY, IN ORDER TO INCREASE OR IMPROVE LEVELS OF PUBLIC SERVICES, INCLUDING K-12 PUBLIC SCHOOL EDUCATION, HEALTH CARE, AND EARLY CHILD CARE AND EDUCATION SERVICES, BY AN AMENDMENT TO THE COLORADO CONSTITUTION AND A CHANGE TO THE COLORADO REVISED STATUTES REPEALING EXISTING LAW AND CREATING NEW LAW TO REPLACE THE UNIFORM STATE INCOME TAX RATE WITH A GRADUATED INCOME TAX STRUCTURE, AND, IN CONNECTION THEREWITH, AMENDING THE TAXPAYER’S BILL OF RIGHTS TO ELIMINATE THE CONSTITUTIONAL REQUIREMENT FOR ALL TAXABLE NET INCOME TO BE TAXED AT ONE RATE WITH NO ADDED TAX ON INCOME; ESTABLISHING VARIOUS INCOME TAX RATES BASED ON THE AMOUNT OF TAXABLE INCOME EARNED BY INDIVIDUALS, ESTATES, TRUSTS, AND CORPORATIONS, WHILE MAINTAINING THE CURRENT 4.4% TAX ON INCOME FROM THE SALE OF A PRINCIPAL RESIDENCE, WHICH WILL RESULT IN THE ESTIMATED CHANGE IN INCOME TAXES OWED BY INDIVIDUALS AS IDENTIFIED IN THE FOLLOWING TABLE; AND AUTHORIZING THE STATE TO RETAIN AND SPEND ANY INCREASED REVENUE FROM THE NEW TAX STRUCTURE, AS A VOTER-APPROVED REVENUE CHANGE, TO SUPPLEMENT CURRENT LEVELS OF FUNDING FOR K-12 PUBLIC SCHOOL EDUCATION, HEALTH CARE, AND EARLY CHILD CARE AND EDUCATION PROGRAMS?
In plain language
A VoterDecoder summary of the official measure text.
Amendment 87 would replace Colorado's flat 4.4 percent state income tax with a graduated tax of six brackets, with rates from 3.7 percent to 8.4 percent. Taxpayers with taxable income below $500,000 would owe less, while higher earners would owe more. The additional revenue would be spent on K-12 education, health care, and early childhood care and education, and exempted from the state's revenue limit. A YES vote creates the graduated tax, while a NO vote keeps the constitutional requirement for a flat rate.
Fiscal impact
The measure is expected to increase state income tax revenue by $958.4 million in budget year 2026-27, which covers only a half year, and by $1.972 billion in 2027-28. Taxpayers with Colorado taxable income below $510,834 would owe less, while those at or above that level would owe more. The maximum revenue change for the first full fiscal year is estimated at $2.7 billion, to account for possible forecast error. The state would also spend about $98,000 in one-time costs at the Department of Revenue.
Official explanation
What does Amendment 87 do?
The measure replaces the state’s current flat income tax rate for individuals and businesses with a graduated income tax that lowers taxes for taxable income below $500,000 and raises taxes for taxable income above $500,000. It requires that the additional money collected from this change be spent on K-12 education, health care, and early childhood care and education, and exempts this money from the state’s constitutional revenue limit, also known as the Taxpayer’s Bill of Rights (TABOR) limit. The state must produce an audited annual report on how much additional revenue was collected and how it was spent.
What is the state’s current income tax structure?
Since 1987, Colorado has had a flat income tax rate, in which all taxpayers, including individuals and businesses, pay the same income tax rate on their income. The state’s current flat income tax rate is 4.4 percent. The majority of state income tax revenue is used for general state programs and services. The TABOR amendment in the state constitution requires that income be taxed at a flat rate.
Income tax is paid on a portion of a household’s or business’s income, which is called taxable income. For example, a married couple earning $42,000 in income per year may have about $10,000 in taxable income and owe $440 in taxes annually. A married couple earning $130,000 in income per year may have about $100,000 in taxable income and owe $4,400 in taxes annually.
What is the graduated income tax structure proposed in Amendment 87?
Amendment 87 removes the constitutional requirement that income be taxed at a flat rate and creates a graduated income tax starting in 2027. In this graduated tax system, an individual’s or business’s income is split into six ranges—called brackets—with the lowest income tax bracket taxed at the lowest rate and each higher bracket taxed at increasing rates, as shown in Table 1.
This is similar to how the federal income tax works. Unlike the federal income tax, the new state income tax brackets are not adjusted for inflation, so more of taxpayers’ incomes will fall into the higher brackets over time. Each tax rate is only applied to the portion of taxable income that falls into that bracket.
Table 1 Graduated Income Tax Rates by Income Bracket Under Amendment 87 Current Amendment 87 Taxable Income Bracket Tax Rate Tax Rate Difference $25,000 or less 4.4% 3.7% -0.7 $25,001 to $100,000 4.4% 4.2% -0.2 $100,001 to $500,000 4.4% 4.4% 0.0 $500,001 to $750,000 4.4% 7.4% +3.0 $750,001 to $1,000,000 4.4% 7.9% +3.5 More than $1,000,000 4.4% 8.4% +4.0
For example, as shown in Figure 1 below, an individual or business earning $125,000 a year in taxable income is taxed at a rate of 3.7 percent for the first $25,000. The next portion of taxable income between $25,000 and $100,000 is taxed at a rate of 4.2 percent. The remaining $25,000 is taxed at the rate of 4.4 percent. The total tax owed under the measure would be $5,175, or $325 less than the $5,500 they would owe under current law.
How does Amendment 87 change the amount of taxes owed?
For individuals and businesses with taxable incomes of less than $500,000, the measure decreases the amount of income taxes owed, up to a maximum reduction of $325 per taxpayer. For taxpayers with incomes of about $500,000 and above, the measure increases the amount of income taxes owed.
Table 2 shows an example of taxes owed under the measure and under current law for seven hypothetical taxpayers with different levels of taxable income.
Income Tax Owed $25,000 $1,100 $925 -$175 $62,500 $2,750 $2,500 -$250 $125,000 $5,500 $5,175 -$325 $300,000 $13,200 $12,875 -$325 $550,000 $24,200 $25,375 +$1,175 $625,000 $27,500 $30,925 +$3,425 $875,000 $38,500 $50,050 +$11,550 $2,000,000 $88,000 $143,925 +$55,925
How does Amendment 87 change state revenue?
By changing tax rates for individuals and businesses, Amendment 87 is expected to increase state income tax revenue by an estimated $2 billion in the first full year and more in later years. However, actual revenue collections may be more or less than this estimate depending on economic conditions and other factors.
The change in state revenue under the measure is calculated as the difference between the actual income tax revenue collected under the measure’s graduated income tax rates and the income tax revenue that would have been collected under the state’s current rate of 4.4 percent. See the Fiscal Impact section below for additional detail.
Does Amendment 87 impact TABOR refunds?
The measure has no impact on current TABOR refunds or TABOR refund mechanisms. Under current law, the state is expected to collect $15 billion in income tax revenue in 2028. Under this measure, it is expected to collect $2 billion more in income tax revenue, for a total of $17 billion. The additional $2 billion is exempt from the TABOR limit. The TABOR limit and the amount of revenue subject to the limit remain the same, and estimated TABOR refunds will not change. For additional information, see the LCS memorandum titled, “A Brief Overview of the TABOR Revenue Limit.”1
How will the additional revenue be spent?
The increased revenue collected under Amendment 87 must be spent on K-12 education, health care, and early childhood care and education. It must add to, and not replace, spending on those services. The state legislature will decide what specific programs will receive additional funding and how much.
What happens if Amendment 87 and Proposition 136 both pass?
Proposition 136 limits the state income tax rate at the current law rate of 4.4 percent. If both Amendment 87 and Proposition 136 are approved by voters, the proposed tax rates for income 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 received more votes. However, if both measures are approved by voters, the exact outcome is unclear. The state legislature or a court will need to determine how to resolve any conflicts.
FINANCIAL IMPACT STATEMENT
Taxpayer Impacts
Amendment 87 will decrease the amount of income tax owed by taxpayers with Colorado taxable income of less than $510,834 and increase the amount of income tax owed by taxpayers with Colorado taxable income of $510,834 and above. State law requires Legislative Council Staff to estimate the potential tax burden on affected taxpayers within specified federal adjusted gross income categories. Federal adjusted gross income is total income from all sources, with certain adjustments, as determined when filing federal income taxes. Colorado taxable income, calculated when filing state income taxes, is based on federal adjusted gross income with additional adjustments required or allowed under state law. Table 3 shows the expected change in tax burden by federal adjusted gross income category. The measure has no impact on current TABOR refunds or TABOR refund mechanisms.
Tax Burden $14,999 or less 579,309 -$638,951 -$1 $15,000 to $29,999 408,924 -$16,093,434 -$39 $30,000 to $39,999 272,616 -$29,611,480 -$109 $40,000 to $49,999 238,539 -$38,651,945 -$162 $50,000 to $69,999 443,000 -$85,925,358 -$194 $70,000 to $99,999 408,912 -$93,232,609 -$228 $100,000 to $149,999 408,912 -$115,554,178 -$283 $150,000 to $199,999 238,532 -$77,522,900 -$325 $200,000 to $249,000 102,228 -$33,224,100 -$325 $250,000 to $499,999 204,456 -$66,448,200 -$325 $500,000 to $999,999 55,900 -$15,893,609 -$284 $1,000,000 or more 46,328 $1,208,468,497
+$26,085
Income is federal adjusted gross income, not Colorado taxable income; therefore, the income ranges and tax rates do not align with those in Table 2. The estimated number of taxpayers column counts joint filers as one taxpayer. Estimates are based on Colorado Department of Revenue data for all residents for tax year 2023 and Legislative Council Staff estimates.
State Revenue
By replacing the state flat income tax with a graduated income tax, the measure increases revenue from income taxes by an estimated $958.4 million in budget year 2026-27, $1.972 billion in budget year 2027-28, and increasing amounts in future years based on income and population growth. The estimate for budget year 2026-27 represents a half-year impact for tax year 2027. The additional revenue will be credited to the Colorado Future’s Account created in the measure. The increased revenue is exempt from TABOR as a voter-approved revenue change. The state budget year begins each July 1 and ends on June 30.
State law requires Legislative Council Staff to include an estimate of the maximum dollar amount of the change in state government revenue for the first full fiscal year of a proposed tax increase. This is the number that appears in the ballot question. The estimates in the previous paragraph represent the revenue impact of the measure under the current Legislative Council Staff revenue forecast. Based on forecast error that could occur, the maximum dollar amount of the change in state government revenue and fiscal year spending for budget year 2027-28 is estimated as an increase of $2.7 billion.
State Spending
The measure increases the amount of state revenue available to spend for the purposes identified in the measure, including K-12 education, health care, and early childhood care and education, in FY 2026-27 and future fiscal years. To administer the tax rate change, the measure is expected to increase one-time spending in the Department of Revenue by $98,000.
School District Revenue and Spending
The measure increases available state funding to school districts. The exact amount distributed to school districts will depend on decisions made by the General Assembly when allocating money from the Colorado Future’s Account.
State Spending and Tax Increases
Article X, Section 20, of the Colorado Constitution requires that the following fiscal information be provided when a tax increase question is on the ballot:
estimates or actual amounts of state fiscal year spending for the current year and each of the past four years with the overall percentage and dollar change; and
for the first full year of the proposed tax increase, estimates of the maximum dollar amount of the tax increase and of fiscal year spending without the increase.
“Fiscal year spending” is a legal term in the Colorado Constitution. It equals the amount of revenue subject to the constitutional spending limit that the state or a district is permitted to keep and either spend or save for a single year. Table 4 shows state fiscal year spending for the current year and each of the past four years.
Table 5 shows the maximum revenue expected from the income tax increase in Amendment 87 for FY 2027-28, the first full fiscal year for which the tax increase would be in place, and an estimate of state fiscal year spending without the tax increase.
Official ballot arguments
Filed for the official voter guide by each side, printed as submitted.
Argument in favor
1) Amendment 87 cuts taxes for 97 percent of taxpayers, including most households and small businesses, while increasing taxes only for top earners who have the ability to pay. A graduated income tax is more equitable than a flat tax because it recognizes a fundamental economic reality: each dollar taxed on someone earning $30,000 imposes a far greater hardship than each dollar taxed on someone earning $1 million. By aligning tax rates with taxpayers’ financial means, a graduated tax distributes the burden more justly across all income levels, lowers taxes for most 1 Online at: leg.colorado.gov/bluebook
households and small businesses, and puts more money in the hands of working families who will spend it in their local communities.
2) The measure funds critical services at a time when additional funding is desperately needed. Crucial programs are at risk of further cuts because of changes in federal policy. Revenue from the graduated tax will fund education, health care, and child care, public services that many Colorado households rely on. Colorado public schools are significantly underfunded, and constraints on the state budget make Medicaid cuts increasingly likely. Additional funding will provide more security for the people who depend on these services.
3) The graduated income tax is not an experiment, but a proven approach for funding essential public services. The federal government and 27 other states already have a graduated income tax. This tax structure lessens rising wealth inequality and increases funding for state programs. Sales and property taxes place greater burdens on lower-income households, and a graduated income tax corrects for this inequity while also funding services for all Coloradans.
Argument against
1) The measure is a multibillion-dollar tax increase, and hiking taxes on higher incomes will harm Colorado’s economy. Higher tax rates make Colorado a less competitive place to start and grow a business, and may encourage some high earners to leave the state entirely. When businesses and high-earning individuals relocate, people at all income levels may lose their jobs. Further, because the brackets do not increase with inflation, more and more taxpayers will pay these higher taxes each year. Colorado cannot risk employers and jobs fleeing the state because our taxes are too high. Keeping taxes competitive for everyone fuels economic activity and builds a stronger, more prosperous Colorado for all.
2) The measure is an attack on the fair and predictable tax system that TABOR currently guarantees. The state’s current flat tax is fair because everyone has equal access to state services, high-income earners already pay more taxes, and low-income earners qualify for more tax deductions and credits. The state should better prioritize the tens of billions of dollars it already collects, rather than switch to a new, complicated tax system.
3) The measure will permanently expand the size of government, increase careless and wasteful spending of taxpayer dollars, and hinder economic growth. Instead of spending billions of dollars more on broadly defined government services, state policy should focus on lowering taxes for everyone or funding specific programs that are proven to help Colorado’s residents.
What supporters and opponents say — outside sources (not official ballot arguments)
Statements by campaigns, officials and news coverage, quoted with attribution and linked to the original. VoterDecoder did not write them and does not endorse either side.
Supporters say
No public statements in favor were found.
Opponents say
No public statements against were found.