Denver Sales Tax for Scholarships Proposal Put on Hold

The sales tax proposal would raise $11 million for college scholarships, but comes in a potentially difficult year, with several other tax votes already planned for November's ballot.
July 25 2013, 10:45 AM

A Denver proposed sales tax to support scholarships for soon-to-be college students has been put on hold—at least temporarily—so a city councilman can gather more input from fellow council members before putting the issue on the November ballot.

The proposed tax, called the Denver Scholarship Promise, would use a sales tax hike for $11 million in college scholarships. According to the Denver Post, the scholarship tax would raise Denver’s sales tax one tenth of one cent to augment private fundraising for the Denver Scholarship Foundation. The tax would expire after 10 years. If the plan were to pass, the Denver Post reports, it would be the nation’s first “dedicated tax for college scholarships.”

But Chris Herndon, the councilman backing the scholarship tax, said this week he’s going to temporarily hold off on the ballot measure, so he can get feedback from the rest of the council. The proposal, it seems, has a long road ahead before it could potentially reach voters.

First, Herndon’s proposal must get the approval of the council’s government and finance committee. Then it must pass the full council by next month if it’s to make the ballot this fall. But perhaps the biggest hurdle is the fact that Denver voters will be considering several other tax proposals—from the statewide tax to support K-through-12 education to a 15 percent excise tax and a 10 percent statewide sales tax on marijuana. Additionally, there’s a potential ballot issue that could ask Denver voters to approve a five percent sales tax on retail pot purchases.

As the free-market Independence Institute’s Jon Caldera told the Post, too many complicated tax issues on one ballot can have negative implications for all of them come Election Day. With that in mind, you have to imagine the council would be at least a little reluctant to press the scholarship issue.

—Image courtesy of Shutterstock