We recently prepared a comprehensive report of 15 States with the Lowest Tax Burden in the US. Click to see the free report.
But the interesting question to answer is: Is Colorado among the top 10 States with the Lowest Tax Burden In the US?
Colorado
State Tax Burden: 7.95%
Income Tax: 4.40%
Sales Tax: 2.90%
Property Tax: 0.55%
Colorado has a flat individual income tax rate of 4.40% and a 4.40% corporate income tax rate. The southwestern US state charges a sales tax of 2.90% and other local authorities in the state can impose up to 4.87% of sales tax, taking the combined state and average local sales tax to 7.78%. The state imposes a property tax rate of 0.55%, one of the lowest among all the states in the US.
Why Are Companies Relocating to Colorado?
Denver is the main metropolitan city in Colorado that attracts all the big companies. Data analytics giant Palantir Technologies Inc. (NYSE:PLTR) relocated to Denver in 2020. The Western Union Company (NYSE:WU) and DaVita Inc. (NYSE:DVA) are two of the leading Fortune 500 with headquarters in Colorado.
On May 1, The Denver Post, a media publication, mentioned DaVita Inc. (NYSE:DVA) among the top workplaces in 2024. On May 2, DaVita Inc. (NYSE:DVA) released its earnings for the first quarter of 2024. The healthcare firm posted earnings per share of $2.38, beating consensus estimates by $0.46. DaVita Inc. (NYSE:DVA) posted a revenue of around $3.07 billion, surpassing estimates by $49.90 million. Here are some of the comments from DaVita Inc.’s (NYSE:DVA) Q1 2024 earnings call:
“Through the first quarter, we continued building on the momentum generated through 2023, demonstrating operational discipline while continuing to find opportunities to invest, innovate and most importantly deliver clinical excellence.
Our aspiration is to enable as many patients as possible to receive this life-changing gift. Let me highlight three ways that DaVita is helping to address the systemic challenges of kidney transplants. The first is patient referrals to transplant centers. We recently achieved our highest monthly rate with more than two-thirds of DaVita patients under the age of 75 years old being referred for transplant.”
Other leading tech companies that have a major presence in Colorado include Salesforce, Inc. (NYSE:CRM), Meta Platforms, Inc. (NASDAQ:META), Zoom Video Communications, Inc. (NASDAQ:ZM), and Comcast Corporation (NASDAQ:CMCSA). According to data compiled by FDI Intelligence, 22 companies relocated to Colorado between 2019 and 2023. According to data from the US Census Bureau, the US recorded around 447,449 new applications filed between January 2023 and January 2024. Out of those 447,449 new applications, 10,848 were filed in Colorado, an increase of almost 9.5% year-over-year.
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Tourism in Colorado and Tax Revenue?
According to a report by the Colorado Office of Economic Development and International Trade (OEDIT), travel spending in Colorado soared from $22.1 billion in 2021 to $26.1 billion in 2022, a rise of 25% year-over-year. Whereas, the number of visitors increased from 84.2 million in 2021 to 90 million in 2022, up by 6.5% year-over-year, as per the Longwoods Travel USA Report. The tourism industry added around $1.7 billion in state and local tax revenue in 2022. By the end of fourth quarter of 2023, Colorado’s state government had generated $4.93 billion from state taxes, according to the US Census Bureau.
Is Colorado the State with the Lowest Tax Burden?
On average, individuals in Colorado pay 7.95% of their income in state and local taxes, compared to the US’s average state tax burden of 11.41%, as of 2024. Colorado is one of the states with the lowest tax burdens, however, it ranks 12th on Insider Monkey’s list. You can go and see our comprehensive report on all the 15 states with the lowest tax burden in the US.
Click to see The Top 15 States that Have the Lowest Tax Burden in the US in 2024.
Disclosure: None. This article is originally published at Insider Monkey.