By Loren Furman & J.J. Ament & Michael Smith
Published October 7, 2026
Amendment 87’s supporters say a graduated income-tax system would impact only a small number of “wealthy” Coloradans. But that claim ignores the broader economic consequences for local employers, family businesses, farms, ranches and the communities that depend on them.
Colorado’s small businesses sustain Main Street and rural economies across the state. If small businesses can no longer afford to invest, hire, expand or simply keep their doors open, the consequences will reach far beyond their bottom line. There will be fewer jobs and local services and less support for schools, nonprofits and community institutions that sustain our communities.
As Gov. Jared Polis said, the measure is “bad policy that would destroy our economy.”
This is why we urge Colorado voters to reject Amendment 87.
Our organizations represent thousands of small businesses across the state, and we hear the same concerns every day: Colorado is too expensive to run a business and too expensive for employees too. Rising insurance premiums, supply costs, energy and diesel prices, regulatory complexity and the cost of living are crushing our ability to grow and invest in the future. Amendment 87 would make it even harder to hire, expand and stay competitive at exactly the wrong time.
This measure will impose the largest tax increase on Colorado small and local businesses in state history. It would take nearly $2.7 billion out of Colorado’s economy each year, and the money would never be eligible for a TABOR refund. The measure removes taxpayer protections of a simple 4.4% flat income tax from the state constitution and replaces it with a graduated tax system that nearly doubles the top rate, putting Colorado with the likes of New York, New Jersey and California.
Colorado’s local businesses are not giant corporations. Seven out of every eight businesses — 88% — in the state are pass-through businesses: LLCs, S corporations, partnerships, sole proprietorships, family farms and ranches. IRS data shows that more than 30,000 small businesses may pay up to double their income taxes if this measure passes.
Unlike corporations, owners of small businesses pay taxes on their business income through their personal tax return, not a corporate one. This is true even when that money is never actually paid out to the owner but is instead reinvested in hiring, equipment, or inventory or saved for next year’s potential drought or emergency. This is how these businesses survive.
Additionally, Amendment 87’s new tax brackets are not indexed for inflation. Over time, small businesses and middle-class families will pay more and more as they are pushed into higher tax brackets — even as their real purchasing power is declining.
The people most affected by this tax are not faceless “high earners” or your “rich uncle” who collect hundreds of thousands of dollars in salary. They are the restaurant owner trying to keep staff employed through the offseason and the contractor deciding whether to add another crew. They are the brewer considering a new taproom and the farmers and ranchers who need new equipment. Raising income-tax rates means raising taxes on the capital small businesses rely on to operate and grow.
Companies can locate, expand and create jobs in any number of states. They look at tax rates, regulations, operating costs, workforce availability and certainty. When Colorado becomes more expensive and less predictable, it is easier for an employer to choose another state and take jobs and investment with it. Amendment 87 would vault Colorado into the top-10 highest states in America for income taxes.
That should concern every Coloradan. Since 2019, Colorado has lost 98 firms and 13,607 known jobs to relocations or missed economic-development opportunities. Colorado fell from No. 11 to No. 25 in CNBC’s “America’s Top States for Business” rankings. Higher costs, aging infrastructure and additional regulatory burdens have weakened our standing. Amendment 87 would make those challenges worse.
Small businesses — those with fewer than 500 employees — account for 99.5% of Colorado businesses and employ about 1.2 million Coloradans. When a local business delays an expansion or decides against a new hire, the impact does not stop at that business. It affects employees, suppliers, customers and communities across the state.
This is not the right time for another tax hike for Colorado families and small businesses, who are struggling to make ends meet and operating on thin margins. Things in Colorado are already too expensive.
Vote no on Amendment 87.
Loren Furman is president and chief executive of the Colorado Chamber of Commerce. J.J. Ament is president and chief executive of the Denver Metro Chamber of Commerce. Michael Smith is state director of the National Federation of Independent Business.
