Gov. Jared Polis signs House Bill 21-1265, which provides temporary sales tax relief to food and drink businesses, on June 14, 2021. The ceremony was held at The Glenn Bar and Grill in Northglenn. (Screenshot/Governor Jared Polis Facebook page)
Colorado’s bars and restaurants may have been slammed by the COVID-19 pandemic, but they’re about to get three months of additional relief from state sales taxes.
House Bill 21-1265 — which Gov. Jared Polis, a Democrat, signed into law Monday — would extend sales tax relief that passed during the Colorado General Assembly’s December 2020 special session focused on COVID-19 response. Under that legislation, restaurants and bars could keep the 2.9% sales tax they’d normally pay to the state, applying up to $2,030 in sales tax relief to as many as five locations a month. The sales tax relief passed during the special session originally lasted through February.
HB-1265 applies the same relief to June through August sales and expands it to caterers, food service contractors, and hotel-operated restaurants. Sponsored by Reps. Kyle Mullica, D-Northglenn, and Kevin Van Winkle, R-Highlands Ranch, along with Sens. Brittany Pettersen, D-Lakewood, and Rob Woodward, R-Loveland, the bill will cost the state around $45 million.
The one-time money comes from higher-than-expected state tax revenue last year, which allowed Colorado lawmakers to devise a “Colorado Comeback” stimulus plan that pours $800 million into new housing and commercial development, assistance for families and businesses, workforce training, and more.
HB-1265 allows restaurants “not to, effectively, have to pay the 2.9% on sales that they normally pay, which is so timely for them because they need that money to be able to give employees raises right now and attract people back to work,” Polis said during a signing ceremony at The Glenn Bar and Grill in Northglenn.
Additional state stimulus bills Polis signed Monday include:
• Senate Bill 21-241, which creates an accelerator program for small businesses
• House Bill 21-1263, which helps cover the costs of conferences and festivals in Colorado
• House Bill 21-1285, which creates incentives for film production and provides grants for arts organizations
• Senate Bill 21-231, which provides funding to help low-income people improve their homes’ energy efficiency
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