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Amendment 66 Economic Analysis: Increasing Income Tax Won’t Harm Colorado Economy

Raising the income tax to support public education, as voters will be asked to do this fall when they vote on Amendment 66, will not hurt Colorado’s economy, since state taxes have only a minor effect on economic growth. State tax increases or cuts have little influence on business-location decisions, the creation of small businesses or other economic activity, a large body of research shows.1 Other factors, like how the nation is faring economically and how much consumers are spending, are far more important to the economic health of states.

Education also has a major impact on state economies. States that invest a lot in their schools have higher wages, higher productivity and more overall economic growth than other states.2 Amendment 66 offers Coloradans the opportunity to improve K-12 education and open new pathways for our future workers and business owners. The benefits will far outweigh the costs.

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