Restaurants in Colorado can keep what they’d normally pay in sales taxes during the next three month, a concession granted specifically to the industry by state lawmakers.
The unconventional form of financial assistance is expected to save local restaurants, bars, caterers and foodservice contractors up to $40 million through the summer. The law allows them to deduct their total taxable sales from their remissions to the state, up to a maximum of $70,000.
The program began July 1 and runs through the end of September.
Sponsors of the bill said it reinstates the sales-tax moratorium that expired 10 months ago, while many restaurants were still feeling the negative effects of the pandemic. Many states and counties similarly discontinued or delayed their collection of sales taxes during the crisis as a way of leaving businesses with a stronger cash flow.
The measure, approved by the legislature in a bipartisan vote, was signed into law by Gov. Jared Polis on June 3.
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