Cutting back on your 'SALT'
Will capping "SALT" deductions - the allowance on federal tax returns for the cost of state and local taxes - take away the bread and butter of Colorado's state and local governments? Some critics of the tax reform predict it will put a damper on voters' willingness to approve state or local tax measures for basic services and infrastructure like schools and roads. Will backers of ballot issues have to turn on the hard sell as never before in pitching their proposals? Meanwhile, will cutting some of the SALT out of taxpayers' diet be offset by lower federal income-tax rates?
Uncle Sam giveth - and Colorado taketh away?
Most Coloradans will pay lower federal taxes, yet some will actually see their state income tax bills rise. Colorado's flat 4.63 percent state income tax, which remains unchanged, is pegged to taxable income on federal returns. That amount will rise for some taxpayers, given the cut in some federal deductions. Will the lower overall federal rate for such taxpayers be enough to counter the additional money they'll fork over to the Colorado Department of Revenue?
Boon to breweries
The tax reform includes big cuts in the federal excise tax on every barrel of beer, with the biggest cut going to small breweries like a lot of Colorado's craft beer producers. The new tax code provision only lasts a couple of years, but could it prompt the state's booming craft beer industry to brew up even more jobs, as anticipated?
A 20 percent deduction on pass-through earnings for self-employed sole proprietors and other kinds of small businesses reinvesting in themselves could lighten the load for upstart entrepreneurs - and create an incentive to expand. Will the initiative bear fruit in Colorado, where nearly half of the private-sector work force is employed by small businesses?
The state's larger employers will benefit not only from a big cut in the corporate tax but also a 100 percent deduction for capital investments over five years. Boosters of the tax reform say it will rev the engines of Colorado's economy and generate job growth. Coloradans - and no doubt the tax plan's critics - will be watching closely.
A new health care crunch?
The tax overhaul's elimination of Obamacare's much-debated individual mandate scratches a longtime Republican itch, but will it also lead to a renewed surge in Coloradans who opt to drop health coverage; a spike in insurance premiums, and even some people losing coverage as critics warn?
Net loss, or gain, for Colorado?
After accounting for all the wide-ranging and far-reaching effects of the tax reform, including how it meshes, or clashes, with Colorado's tax code, will the typical Colorado household come out ahead or behind after adding up all the new tax bills?
Dan Njegomir, colorado politics