Jack Pommer (D-Boulder), a Colorado state representative who sponsored Bill 1191 to Eliminate Candy and Soda Sales Tax Exemption, said the taxes were originally designed to help the state from going broke rather than to only help higher education.
“The taxes really are to help the state from going broke, though they will still help higher education in a small way,” Pommer said.
One tax especially applicable to students is a recently signed bill, Bill 1191, a permanent 2.9 percent sales tax. The tax, which will take effect May 1 is expected to bring in $18 million in the upcoming 2010-2011 fiscal year, said Mark Couch, Colorado Department of Revenue communications director and legislative liaison.
Candy and soda have previously been exempt from tax in the state of Colorado. However, the new bill lays out specific rules to outline what is considered part of this tax. For example, according to the definition of the bill, a “soft drink” is a beverage that contains natural or artificial sweeteners, and is non-alcoholic.
Couch said though there are no specific plans for the candy and soda tax to fund higher education, it will generate more revenue that will indirectly contribute to higher education.
“The elimination of this particular tax break will eliminate deeper cuts in [higher education] programs,” Couch said.
Louie Moschetti, co-owner of Jones General Store and Camera on the Hill, said he views the tax as a hassle because it will be a lot more work for his employees. However, he said he does not think it will influence business.
“People won’t stop buying the product because it went up by 3 cents,” Moschetti said.
Kristina Berg, a 19-year-old sophomore environmental studies and geography major, said she agrees with Moschetti.
“People probably wouldn’t even realize if they are taxed an extra few cents on a soda. People also don’t know a lot about taxes in general,” Berg said.
Pommer said all the proposed taxes that Gov. Bill Ritter plans to enact will raise a total of about $100 million; however, higher education will need about $200 to $300 million to stay at its current level of funding. Even if all the money raised from taxes goes directly toward higher education, it will still not solve the budget problems.
Pommer said at this point, there are no specific plans for the tax money to go directly towards higher education. However, any revenue will help.
“It will put off the real trouble for a little,” Pommer said
The real trouble is what politicians call “The Cliff,” a term used to describe the problem students will face when higher education funding runs out in a year or two, Pommer said.
“When we reach ‘The Cliff,’ we will have two options. We can either close colleges, or raise tuition, or a combination of both,” Pommer said.
Pommer said although Ritter has no plans to raise tuition, he thinks he might, especially given legislature’s future plans for the budget.
“Though we will reach ‘The Cliff’ in 2012 or 2013, the legislature has plans to put money into new highways in about two years,” Pommer said.
Hailee Koehler, a 22-year-old senior political science major and co-director of Legislative Affairs for UCSU, voiced her concern for the government’s priorities,
“Unfortunately, higher education funding may be their lowest priority because there is a lot going on with K -12, health care and other programs,” Koehler said.
The public is split about how to solve the issue with higher education, Pommer said.
“Even now, when things are pretty bad, half would like to put more money into higher ed., but we can’t, because we don’t have the money, and others still want to cut taxes,” Pommer said.
Koehler said CU receives very little funding from the state.
“We need millions of dollars to save higher ed.,” Koehler said. “We are currently funded at less than 5 percent [from the government], which isn’t a very large sum relative to the cost of operating the institution. Most of the revenue comes from tuition.”
Berg said she has noticed an apparent lack of funding because she can’t get into classes required for her major.
“Classes are over-crowded, and there is physically not enough room in classrooms for students enrolled,” Berg said.
Koehler said UCSU presented a more conservative budget this year to reflect their effort to help cut back on spending, so the university’s money could be allocated to the areas of greater need.
Yet as much as CU tries to form temporary solutions, everything requires money, Pommer said.
“You can’t get by without any money, so we are kind of stuck in a rut,” Pommer said.
Additional information about recently enacted taxes, their influence on higher education funding or this specific bill can be viewed on Ritter’s Web site.
Contact CU Independent Staff Writer Jessica Freeman at Jessica.email@example.com.