Last month, Kristi Burton Brown, executive vice president of the conservative policy organization Advance Colorado, appeared on a conservative radio show to discuss the alleged dangers of the graduated income tax, as proposed in ballot initiative 195, while also promoting Advance Colorado’s ballot initiative 232, which would cap the state’s tax rate at its current level of 4.4%.
During the show, Brown stated: “This kind of, you know, idea on taxing people differently is not something that’s fundamentally American in how they do it,” referencing the graduated income tax. Her statement and the surrounding context are shown below.
According to the Tax Foundation, a Washington think tank, “a graduated rate income tax system consists of tax brackets where tax rates increase as income increases. Typically, this results in a taxpayer’s effective income tax rate, or the percentage of their income paid in taxes, increasing as their income increases.”
Colorado does not have a graduated income tax, opting instead for the aforementioned flat tax rate of 4.4%, as required by Section 8 of TABOR.
However, this was not always the case. According to the Bell Policy Center, “Colorado had a graduated income tax for decades. While Colorado’s rates shifted throughout the years, it was a proportional system. It ensured the wealthy paid a higher percentage of their income than those at the lower end of the income ladder,” which lasted until 1987, when the state switched to a flat tax rate.
Furthermore, our current federal tax system features a graduated income tax, as allowed by the U.S. Constitution under the 16th Amendment. The federal income tax rates run from 10% to 37%. Outside of the federal level, 26 states and the District of Columbia also utilize a graduated income tax system.
In light of these facts, it is difficult to accurately characterize the graduated income tax as something that’s un-American.
Even though the graduated income tax is a system that can be confidently described as ‘American’, its implementation throughout Colorado is still a very controversial topic. The debate about a graduated income tax has become more heated in Colorado as progressive and conservative policy organizations have introduced opposing tax ballot initiatives for the midterm election ballot.
Progressive organizations, such as The Bell Policy Center, have backed Initiative 195, which seeks to alter TABOR to allow for a graduated income tax, and then re-establish the graduated income tax with rates ranging from 3.7% to 8.4%.
In response, conservative organizations such as Advance Colorado have pushed for the aforementioned Initiative 232, capping the state’s current tax rate.
