A Bill for an Act
Page 1, Line 101Concerning a sales and use tax holiday for back-to-school
Page 1, Line 102items.
Bill Summary
(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)
Section 1 of the bill creates a time-limited state sales and use tax exemption (tax holiday) for back-to-school items. The tax holiday applies to the last weekend of July 2027 and reoccurs at approximately the same time in 2028 and 2029. A "back-to-school item" means an article of clothing, a school supply, or a learning aid that is purchased primarily for use by an individual who is under 21 years old. The exemption for each item is limited by cost as follows:
- $100 for an article of clothing;
- $50 for a school supply; and
- $30 for a learning aid.
Section 2 permits a town, city, or county to create a tax holiday for back-to-school items that is identical to the state tax holiday.
Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:
Page 2, Line 2SECTION 1. In Colorado Revised Statutes, add 39-26-735 as
Page 2, Line 3follows:
Page 2, Line 439-26-735. Back-to-school items - tax preference performance
Page 2, Line 5statement - rules - legislative declaration - definitions - repeal.
Page 2, Line 6(1) In accordance with section 39-21-304 (1), which
Page 2, Line 7requires each bill that creates a new tax expenditure to include
Page 2, Line 8a tax preference performance statement as part of a statutory
Page 2, Line 9legislative declaration, the general assembly hereby finds and
Page 2, Line 10declares that:
Page 2, Line 11(a) The general legislative purpose of the exemption
Page 2, Line 12allowed by this section is to provide tax relief to certain
Page 2, Line 13individuals;
Page 2, Line 14(b) The specific legislative purpose of the exemption
Page 2, Line 15allowed by this section is to increase the affordability of
Page 2, Line 16back-to-school items and to redress the burden that the
Page 2, Line 17imposition of sales tax places on millions of parents and other
Page 2, Line 18caregivers for young children in Colorado for whom such
Page 2, Line 19back-to-school items are essential; and
Page 2, Line 20(c) To allow the general assembly and the state auditor
Page 2, Line 21to measure the effectiveness of the exemption allowed by this
Page 2, Line 22section, the state auditor, in collaboration with the department
Page 3, Line 1pursuant to subsection (6) of this section, shall identify
Page 3, Line 2available data sources and estimate the savings that the
Page 3, Line 3exemption for back-to-school items provides to taxpayers in
Page 3, Line 4Colorado for whom back-to-school items are essential during
Page 3, Line 5the state auditor's evaluation of the exemption pursuant to
Page 3, Line 6section 39-21-305.
Page 3, Line 7(2) As used in this section, unless the context otherwise
Page 3, Line 8requires:
Page 3, Line 9(a) "Back-to-school item" means an article of clothing, a
Page 3, Line 10school supply, or a learning aid that is purchased primarily for
Page 3, Line 11use by a minor.
Page 3, Line 12(b) "Clothing" means:
Page 3, Line 13(I) Any article of apparel intended to be worn on an
Page 3, Line 14individual, excluding a clothing accessory; and
Page 3, Line 15(II) Any footwear, excluding skis, snowboards, swim fins,
Page 3, Line 16roller blades, skates, and other recreational equipment.
Page 3, Line 17(c) "Clothing accessory" means an incidental item worn
Page 3, Line 18on an individual or used in conjunction with clothing. "Clothing
Page 3, Line 19accessory" includes jewelry, wallets, watches, hats, scarves,
Page 3, Line 20hosiery, ties, belts, and umbrellas.
Page 3, Line 21(d) "Department" means the department of revenue.
Page 3, Line 22(e) "Executive director" means the executive director of
Page 3, Line 23the department.
Page 3, Line 24(f) "Learning aid" means a book or toy intended to teach
Page 3, Line 25skills to children, including a set of stacking or nesting blocks,
Page 3, Line 26flash cards or other learning cards, a matching or memory
Page 3, Line 27game, a puzzle book or a search-and-find book, or an interactive
Page 4, Line 1or electronic book.
Page 4, Line 2(g) "School supply" means an art supply, backpack, binder
Page 4, Line 3pocket, binder, blackboard chalk, calculator, cellophane tape,
Page 4, Line 4clay and glaze, compass, composition book, crayon set,
Page 4, Line 5dictionary or thesaurus, dry erase marker and eraser, folder,
Page 4, Line 6glue and paste, highlighter, index card set and box, lunch box,
Page 4, Line 7map or globe, marker, notebook and divider, paper or pad, pencil
Page 4, Line 8box or other boxes for school supplies, pencil sharpener, pencil
Page 4, Line 9and eraser, pen, protractor, reference book, ruler, scissors,
Page 4, Line 10textbook, or workbook.
Page 4, Line 11(3) (a) Commencing with the forty-eight-hour period
Page 4, Line 12beginning at 11:59 p.m. on July 23, 2027, and ending at 11:59 p.m. on
Page 4, Line 13July 25, 2027, and for the forty-eight-hour periods beginning at
Page 4, Line 1411:59 p.m. on July 28, 2028, and ending at 11:59 p.m. on July 30,
Page 4, Line 152028, and beginning at 11:59 p.m. on July 27, 2029, and ending at
Page 4, Line 1611:59 p.m. on July 29, 2029, the sale of back-to-school items priced
Page 4, Line 17less than the limit established in subsection (3)(b) of this section
Page 4, Line 18is exempt from the sales tax levied pursuant to part 1 of this
Page 4, Line 19article 26.
Page 4, Line 20(b) The limit for each back-to-school item is:
Page 4, Line 21(I) One hundred dollars for an article of clothing;
Page 4, Line 22(II) Fifty dollars for a school supply; and
Page 4, Line 23(III) Thirty dollars for a learning aid.
Page 4, Line 24(4) The storage, use, or consumption of a back-to-school
Page 4, Line 25item that is exempt at the time of purchase from sales tax
Page 4, Line 26pursuant to subsection (3) of this section is exempt from the use
Page 4, Line 27tax levied pursuant to part 2 of this article 26.
Page 5, Line 1(5) The executive director may:
Page 5, Line 2(a) Modify existing forms or create new forms as
Page 5, Line 3necessary to facilitate the exemption created in this section;
Page 5, Line 4and
Page 5, Line 5(b) Adopt rules for the administration and enforcement
Page 5, Line 6of this section.
Page 5, Line 7(6) The department, in consultation with the state
Page 5, Line 8auditor, shall collect the information necessary for the state
Page 5, Line 9auditor to measure the effectiveness of the exemption created
Page 5, Line 10in this section as required by subsection (1)(c) of this section.
Page 5, Line 11(7) This section is repealed, effective December 31, 2033.
Page 5, Line 12SECTION 2. In Colorado Revised Statutes, 29-2-105, amend (1)
Page 5, Line 13introductory portion, (1)(d)(I)(T), and (1)(d)(I)(U); and add (1)(d)(I)(V)
Page 5, Line 14as follows:
Page 5, Line 1529-2-105. Contents of sales tax ordinances and proposals.
Page 5, Line 16(1) The sales tax ordinance or proposal of any incorporated town,
Page 5, Line 17city, or county adopted pursuant to this article 2
shallPage 5, Line 18on the sale of tangible personal property at retail or the furnishing of
Page 5, Line 19services, as provided in subsection (1)(d) of this section. Any countywide
Page 5, Line 20or incorporated town or city sales tax ordinance or proposal
shallPage 5, Line 21include the following provisions:
Page 5, Line 22(d) (I) A provision that the sale of tangible personal property and
Page 5, Line 23services taxable pursuant to this article 2 is the same as the sale of
Page 5, Line 24tangible personal property and services taxable pursuant to section
Page 5, Line 2539-26-104, except as otherwise provided in this subsection (1)(d). The
Page 5, Line 26sale of tangible personal property and services taxable pursuant to this
Page 5, Line 27article 2 is subject to the same sales tax exemptions as those specified in
Page 6, Line 1part 7 of article 26 of title 39; except that the sale of the following may be
Page 6, Line 2exempted from a town, city, or county sales tax only by the express
Page 6, Line 3inclusion of the exemption either at the time of adoption of the initial
Page 6, Line 4sales tax ordinance or resolution or by amendment thereto:
Page 6, Line 5(T) The exemption for sales of heat pump systems and heat pump
Page 6, Line 6water heaters set forth in section 39-26-732;
andPage 6, Line 7(U) The exemption for sales of energy storage systems set forth
Page 6, Line 8in section 39-26-733; and
Page 6, Line 9(V) The exemption for back-to-school items specified in
Page 6, Line 10section 39-26-735 (3), for the same periods that the state
Page 6, Line 11exemption is available.
Page 6, Line 12SECTION 3. Act subject to petition - effective date. This act
Page 6, Line 13takes effect at 12:01 a.m. on the day following the expiration of the
Page 6, Line 14ninety-day period after final adjournment of the general assembly; except
Page 6, Line 15that, if a referendum petition is filed pursuant to section 1 (3) of article V
Page 6, Line 16of the state constitution against this act or an item, section, or part of this
Page 6, Line 17act within such period, then the act, item, section, or part will not take
Page 6, Line 18effect unless approved by the people at the general election to be held in
Page 6, Line 19November 2026 and, in such case, will take effect on the date of the
Page 6, Line 20official declaration of the vote thereon by the governor.