HB 25-1005

House Bill 25-1005 eliminates a state sales tax vendor fee that retailers can currently keep to cover the costs of collecting and remitting sales taxes, starting January 1, 2026. This means retailers will no longer be able to retain this fee for their expenses related to handling sales tax. The bill also adjusts how certain tourism funds are calculated and ensures a specific amount of housing development grants remain unchanged. It has been signed into law by the governor and is now effective as of August 28, 2025, although the main provision about the vendor fee won't take effect until early next year.

Official Summary

Pursuant to law in effect prior to the passage of the act, a retailer is required to periodically remit to the department of revenue (department) the sales tax revenue that it collects, and some retailers are allowed to retain a sales tax vendor fee to cover the retailer's expenses incurred in collecting and remitting state sales tax.Beginning January 1, 2026, the act eliminates the sales tax vendor fee that retailers are authorized to retain in connection with collecting and remitting state sales tax. The act also makes conforming amendments to prevent additional sales tax revenue from being included in the calculation of state sales tax increment revenue for purposes of the "Colorado Regional Tourism Act" and to maintain the amount of sales and use tax revenue that the state treasurer annually credits to the housing development grant fund.For the 2025-26 state fiscal year, the act appropriates $156,219 to the department from the general fund for the implementation of the act and reappropriates $36,383 of that appropriation to the department of personnel to provide document management services to the department.APPROVED by Governor August 28, 2025EFFECTIVE August 28, 2025(Note: This summary applies to this bill as enacted.)

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