DENVER Republican legislators rallied against a proposed tax hike for schools Thursday, saying it would cost the state 119,000 jobs over five years.
But supporters said the Republicans were misreading their own economic study, and that the proposal will not cost jobs at all.
Proposition 103 seeks a five-year rise in the income tax rate, from 4.63 percent to 5 percent, and the sales tax rate, from 2.9 percent to 3 percent. Much of the projected $3 billion the measure would raise would be earmarked for schools and colleges.
People are strapped right now, and we cannot afford $3 billion taken out of the private sector and moved into government, said Victor Mitchell, a Republican former legislator and head of Save Colorado Jobs, a group formed to oppose Prop 103.
Seven other Republican lawmakers joined Mitchell at a Thursday news conference.
Mitchell cited a study done for opponents by Eric Fruits, a conservative economist, who said the higher tax rates would cost Colorado future jobs.
The sponsor of Prop 103, state Sen. Rollie Heath, D-Boulder, said he doesnt believe Fruits study, but even if its accurate, his opponents are misreading it. Fruits predicted Colorado would add jobs with or without the tax increase, but he said job growth would be slower if taxes rose.
What will cause a loss of jobs is not investing in education, Heath said.
Heaths proposed new tax rates would match the rates Colorado had until the Legislature cut them in 1999. The unemployment rate in December 1998 the last month under the old rates was 3.2 percent, far below todays 8.5 percent.
Mitchell said the schools problem is not a lack of funding. Colorado could solve its problems by expanding charter schools and offering parents vouchers to attend private schools, he said.
Mitchell also said the corporate income tax should be eliminated to attract companies to Colorado.
With Election Day just six weeks away, the campaign looks like it will be fought on a shoestring. Heath said he aims to raise $300,000 to push for Prop 103.
Mitchell did not provide a fundraising goal, but he said his committee would raise whatever is needed to win. A third committee, Too Taxing for Colorado, is headed by veteran conservative activists who usually raise only token amounts of money.
Reach Joe Hanel at [email protected].
