GRAND JUNCTION, Colo- In November, Colorado voters will be asked whether to increase taxes on cigarettes and other tobacco products, and create a new state tax for vaping products.
But city officials might ask voters in Grand Junction to vote on a local sales tax increase as well.
If you’re buying tobacco products in Grand Junction, you currently pay an 84 cents excise tax on cigarettes and a 40 percent tax on all other tobacco products (excluding vaping products). This is the state tax.
But at a city council meeting on Monday, Grand Junction city officials contemplated asking voters in town to approve a measure to add a city wide tobacco and nicotine sales tax.
Nearby areas like Glenwood Springs and Eagle County have a $4 tax on cigarettes and a 40 percent tax on all tobacco and vaping products. This is on top of existing state taxes.
While this brings extra revenue for the city, these proposals are stressful for some businesses.
“If both the proposed state excise increase happens and the city raises their tax we’ll have to take a long hard look at whether or not we are going to stay open,” said Lucas Benson, owner of Rem’s Tobacco Shop in Grand Junction.
Benson says his shop has been a refuge for shoppers from communities who have these high local taxes.
“We’re seeing a lot of people down from Aspen and Glenwood Springs because the tax rate is higher so they come down to Grand Junction where they can buy their stuff cheaper.”
But a high ranking city official says voters may be asked to add this local tobacco and nicotine sales tax due to lost city revenue because of COVID-19, and the Colorado Taxpayer Bill of Rights or TABOR. TABOR directs excess city revenue back to residents through tax reductions or rebates.
“I think tobacco and vaping is a strong possibility simply because there are strength in numbers with the counties that are around us,” said Mayor Duke Wartmann.
The city projects this tax could bring up to $1 million in additional funds to make up for lost ground, and address new needs.
“With COVID hitting and the pandemic, we’re looking at avenues and revenues and looking at ways to back-fill city services that are certainly needed,” Wartmann said.
The city council has until July 26 to decide whether vote on this ballot question and notify the Mesa County Clerk to put this question on the ballot for voters in Grand Junction.