The DMA Way

Completely Compliance: Colorado Simplification

by DMA Staff | Jan 08, 2018
DMA_Blog_CC_Colorado Simplification

As noted in earlier additions, the state established a Simplification Tax Force for sales and use taxes in June, and the group was to report simplification recommendations by November 1. There are many items to note in their final report. After establishing the current methods and processes used by the state and local authorities, the report focuses on four key issues gained from testimony from the Coalition to Simplify Colorado Sales Tax, a group of businesses supporting the simplification.

  1. Reducing licensure and remittance requirements to avoid separate submissions to each jurisdiction
  2. Conflicting definitions of taxable and exempt products
  3. Centralization of information databases that businesses can utilize to remain compliant without penalty
  4. Consolidation of audit authorities to avoid audit exposure from multiple jurisdictions
Many of these issues are comparable to the TPT simplification that Arizona established effective January 1, 2017.

In response to these concerns, some actions have been taken. For example, as of November 1, 2017, 20 self-administered locals have established standardized definitions for exempt and taxable purposes. A listing of the jurisdictions is available in the link provided. However, some local jurisdictions such as Castle Rock, opposed the simplification and noted the importance of administering their own local tax. The tax force is to meet within 90 days for further discussion.