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Colorado: Cigarettes to Remain Taxable


 Colorado will continue to tax sales of cigarettes. Consider the tax revenue in one ashtray.

It’s official. The sales and use tax exemption for cigarettes in Colorado has been eliminated. HB 13-1144 has been signed into law. Effective July 1, 2013, cigarettes will be subject to sales and use tax in Colorado.

Actually, sales of cigarettes in Colorado are currently taxable, but the tax was supposed to be temporary. The relationship between sales tax and cigarettes in Colorado is a bit like a turbulent love affair: one day cigarettes are taxable, the next day they’re exempt.  Colorado exempted cigarettes from sales tax until July 2009, when that exemption was suspended. Since then, cigarettes have been subject to sales and use tax in the Mile High State. That was supposed to change this July, when the exemption was set to be reinstated. Now it’s gone for good--or at least until the passion for tax-free cigarettes is rekindled.

According to lawmakers, "this act is necessary for the immediate preservation of the public peace, health, and safety."

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Colorado State Rates

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.