Double the Tax, Half the Freedom: Colorado’s 2026 Ballot Bomb
In June 2025, Colorado’s progressive machine took a bold step: a coalition led by Advance Colorado announced a 2026 ballot initiative that would more than double the state income tax for high earners, raising it from 4.4% to 9.5% for those earning over $1 million annually. Meanwhile, individuals earning under $100,000 would see a modest cut, from 4.4% to 4.2% (Rocky Mountain Voice).
At first glance, it’s pitched as fairness: make the rich pay more. But in reality, this proposal threatens to turn Colorado from a tax-friendly growth engine into a California-style cautionary tale. For freedom-minded families, entrepreneurs, and retirees, this is a clear sign: relocate while you still can.
The End of Flat and Fair
Since 1987, Colorado’s flat income tax has served as a beacon for fiscal conservatism in the Mountain West. It’s simple, predictable, and growth-oriented. But this new measure would eliminate that legacy and introduce a steep marginal tax hike on high earners, while granting a pittance to lower earners.
What’s more dangerous than the numbers is the precedent. Once you accept progressive taxation, the definition of “rich” is always subject to change. Today, it’s $1 million. Tomorrow? As The Colorado Sun noted in a similar 2020 analysis, “progressives plan a step-by-step overhaul, expanding new brackets downward with every election cycle” (Colorado Sun).
How Colorado Stacks Up Now—And What It Could Become
Currently, Colorado’s 4.4% income tax is competitive regionally, especially compared to neighbors like New Mexico (top rate: 5.9%) or Utah (4.65%). But if this ballot measure passes, Colorado would leap to one of the highest top income tax rates in the nation, just behind California (13.3%) and New Jersey (10.75%) (Tax Foundation).
This proposal comes on the heels of a multi-year trend: Colorado’s cost of living has soared, housing affordability is collapsing, and state government spending is rising. Tax hikes like this fuel the fire, driving high earners, job creators, and eventually, middle-class families to vote with their feet.
Migration Speaks Louder Than Ballots
According to the IRS, Colorado experienced net outmigration of high-income earners in 2023 and 2024, particularly to Texas, Florida, and Arizona—states with either no income tax or more predictable fiscal environments (IRS SOI Migration Data).
The U.S. Census Bureau confirms this trend: “Coloradans with higher adjusted gross incomes are among the most likely to leave,” often citing tax burdens, public policy, and declining quality of life (U.S. Census Bureau).
This is not theory. It’s already happening. And proposals like the 2026 millionaire tax guarantee that the exodus will accelerate.
The Slippery Slope is Real—and Planned
Supporters of the initiative claim the goal is “equity,” but the real aim is redistribution and political entrenchment. The National Taxpayers Union Foundation warns: “Once states begin targeting high earners, they almost always expand these measures to include more taxpayers. Tax thresholds shrink. Brackets multiply. Revenues disappear as taxpayers flee” (NTU Foundation).
Even now, the Colorado Education Association and other groups are exploring additional tax hikes on earners above $300,000. The 9.5% top rate may only be a warm-up act for future measures aimed at the upper-middle class and small business owners.
The Promise of Revenue vs. The Reality of Spending
Proponents estimate the measure will raise $1 billion annually, to be retained by the state rather than refunded under the Taxpayer’s Bill of Rights (TABOR). They claim it will fund education, infrastructure, and healthcare. But there’s little discussion of how spending will be managed, and even less on the long-term consequences.
As the Tax Foundation notes, states with high income tax rates tend to suffer from “unpredictable revenue streams, budget shortfalls, and flight of high-income residents—resulting in a downward fiscal spiral” (Tax Foundation).
what this means for you
At RedRefuge, we help families relocate from states where freedom, security, and prosperity are in decline—and Colorado, regrettably, is fast becoming a case study in this shift.
This ballot measure tells us two things:
Colorado’s progressive establishment is just getting started.
You should start planning your move before they come for more.
Where to Go, and Why Now
States like Florida, Texas, Tennessee, and South Dakota offer:
No state income tax
Pro-growth regulatory environments
Strong protections for parental rights, property rights, and free enterprise
Lower cost of living in key markets
These states are not perfect, but they do not punish success—and they respect families who want to raise their children with traditional values and financial autonomy.
start planning Now
Research alternative states using RedRefuge’s relocation guides.
Talk to a RedRefuge-aligned real estate agent in your target destination.
Start planning now—before your tax return, equity, or retirement is up for grabs in 2026.
Final Thoughts
Colorado’s proposed “Millionaire Tax” is not just a policy shift. It’s a flashing red warning light for anyone who values financial freedom and responsible governance.
Whether or not you meet the $1 million income threshold, this ballot measure threatens the culture, the economics, and the long-term trajectory of the state. Don’t wait to become a statistic. Start your RedRefuge journey now—before this ballot initiative becomes a permanent part of Colorado’s identity.
