Colorado Voters Reject Proposition 136 Income Tax Cap

The Colorado State Capitol stands quiet on 16th Street in Denver, the Civic Center Station humming beneath the pavement. It’s a still image, but the political machinery behind it just ground to a halt.

Colorado voters have spoken, and they rejected Proposition 136. As of 9:41 a.m. Friday, the Associated Press called the race, with the measure trailing 52.7% to 47.3%. For context, Proposition 136 was brought by the conservative political nonprofit Advance Colorado. Its goal was to establish a hard cap on the income tax rate at 4.4%.

Let’s do the math on what this actually meant for your wallet. On paper, the measure looked like a shield against future tax hikes. In practice, it would have changed nothing immediately. The current income tax rate is already 4.4%. Furthermore, Colorado law dictates that taxes can’t be increased without voter approval anyway. So, if you’d voted yes, you’d have locked in the current rate, but you wouldn’t have saved a single dime today.

The real target wasn’t your paycheck; it was Amendment 87. That separate ballot initiative, backed by liberal groups, sought to implement a graduated income tax. It would have raised taxes on households and businesses earning more than $500,000 a year. Supporters of Amendment 87 argued that Proposition 136 was a political ploy designed to confuse voters and block the new tax brackets.

Two conservative nonprofits, Colorado Dawn and Common Sense America, spent hundreds of thousands of dollars to collect the signatures needed to get Proposition 136 on the ballot. These groups don’t disclose their donors, adding a layer of opacity to the campaign. Had both measures passed, the state would have faced a legal dispute over how to reconcile the six new tax brackets in Amendment 87 with the proposed income tax limit. Historically, courts have held that if two conflicting measures pass, the one with the most votes takes precedence.

With the defeat of Proposition 136, that legal headache is avoided. Amendment 87, which supporters declared victory for at a Thursday afternoon press conference, now moves forward unencumbered by the tax cap. Opponents of the amendment conceded defeat early Friday morning. The state avoids a court battle over conflicting tax laws, and the graduated tax brackets for high earners are set to take effect.

For locals, the bottom line is simple: the state income tax rate stays at 4.4% for now, but the door is open for higher rates on top earners under the new Amendment 87 structure. The tax cap didn’t save anyone’s money today, but it did clear the path for the new tax system.