DENVER Gov. John Hickenlooper signed into law a tax exemption for farm and ranch supplies Monday, reversing the Legislatures 2010 decision to tax them.
Hickenlooper signed House Bill 1005 at Aero Applicators, a crop-dusting business in Sterling. It repeals that states 2.9 percent sales tax, plus local sales taxes, on a variety of agricultural supplies, including pesticides, growth hormones and animal vaccines.
The Legislature took away the sales tax exemption in 2010 when Democrats controlled the statehouse. Republicans insisted on repealing the tax this year in return for their votes on the state budget.
Opponents of the tax said it was particularly hard on agriculture suppliers near the state line, but no data exists to show for certain how many farmers crossed the border to buy supplies.
Lynn Forssberg, general manager of Basin Coop in Durango, told a similar story.
There were people unhappy about it. Im sure some of them probably did go to New Mexico, but we have no way of knowing for sure, Forssberg said.
As of July 1, farmers and ranchers wont have to pay the tax any more. And stores like Forssbergs will not have to collect the tax on the states behalf.
Itll lighten our workload a bit, too. Definitely, its a good thing for anyone in agriculture, Forssberg said.
The Legislatures economists expect the repeal to cost the state $3.7 million a year in lost revenue.
The Legislature originally exempted agricultural supplies from the sales tax in 2004.
Last years repeal of the exemption was scheduled to expire in July 2013.
Reach Joe Hanel at [email protected].
