Proposals to raise alcohol taxes & fees fall flat in Colorado Legislature (The Sum & Substance)
Ed Sealover
March 19, 2026
A Colorado House committee rejected two attempts in the past two days to raise taxes or fees on beer, wine and spirits sales, heeding pleas from small brewers and distillers that additional costs could deal a significant blow to their already struggling sectors.
House Bills 1271 and 1301 sought to use revenues from the liquor industry to help subsidize the treatment of conditions that their products can exacerbate. Sponsors argued that at a time when the state faces an $850 million budget shortfall, they need to be creative with the ways they raise revenue for public-health and -safety services, and they noted Colorado’s alcohol excise taxes are among the lowest in the country.
Industry groups and some business organizations pushed back, however, noting that the sectors already are suffering under conditions ranging from new tariffs to falling levels of product consumption to rising ingredient costs that outpace price hikes they can take. The combined impact of the two bills would have increased fees and taxes on their products between 154% and 205% depending on the drink type — costs they would have had to cut from elsewhere in their budget, particularly from labor expenses, they warned.
So, on Tuesday, the House Health and Human Services committee rejected HB 1271, which would have instituted new fees on alcohol sales and put them to a trio of enterprises funding alcohol-use disorder prevention and treatment, by a bipartisan 8-5 tally. And on Wednesday, the same committee killed HB 1301, which sought to ask voters to raise taxes on alcohol and marijuana to fund a new mental-health hospital in Aurora, on a 7-6 vote.
Costs to businesses, potential job losses cited
While critics cited several reasons to oppose the measures, a common theme was their deleterious impact on jobs in the sector, which alcohol makers said they would have to cut if rising prices lowered consumer demand and reduced sales further. The local businesses’ push was aided by unions like the Teamsters Local 267, which sent a letter to committee members and showed up to testify at hearing, warning that the cost hikes could reduce distribution jobs and disproportionately harm lower-income Coloradans.
“I completely understand where the bill sponsors’ hearts are at,” said Rep. Sheila Lieder, a Jefferson County Democrat and union advocate who was one of the two Democrats who voted against both bills, about HB 1271. “But I also know that when companies have (price) increases, they pass them along to the consumers … And this bill, I really do believe, will cut jobs.”
Several legislators said the two bills put them into a difficult position of either supporting badly needed funding increases for behavioral-health and substance-abuse-treatment programs or supporting industries that boost Colorado’s culture and economy. The beer wine and spirits industries together account for about 118,800 jobs in Colorado that produce a roughly $23 billion annual economic impact and draw tourists to a state that’s become known for its craft beverages.
Rep. Jamie Jackson, the Aurora Democrat who cosponsored HB 1271, pinpointed the harmful impact of alcoholic beverages as costing Colorado some $5 billion annually in health, public safety and court costs. That number includes the costs of addiction, chronic disease, impaired driving, family instability and emergency care that are related to alcohol abuse, she told the committee.
How the Bills Would Have Worked
HB 1271 would have created sustainable funding — about $35 million annually — for treatment and prevention programs that are now trying to navigate between short-term grants and federal dollars that are being peeled back, supporters said. And HB 1301 could have raised enough money to fund a 50- to 70-bed hospital when the state is 500 mental-health beds short of what is needed — an effort supported by behavioral-health experts, sheriffs and other public-safety leaders desperate for a suitable facility to hold criminal suspects who have not been declared competent to stand trial.
“The situation is bad. It’s getting worse quickly. And we’re doing nothing about it,” said Dr. Bill Berman, Denver Health director of public health. He noted that Colorado, which ranks eighth in alcohol consumption and eighth in alcohol-related hospitalizations, sees about 2,000 residents die annually from alcohol-related causes, a number that’s doubled in the past 10 years.
HB 1271 sought to assess a 5-cent-per-gallon fee on beer and hard cider sales, a 7-cent-per-liter fee to wine and a 35-cent-per-liter fee to spirits. The new taxes proposed by HB 1301 would have been even steeper — 7.3 cents per gallon on beer and cider, 8 cents a liter on wine and 60.26 cents per liter on spirits.