TaxByte: Colorado Passes SB 23-143 | TaxValet

The Colorado Energy Office has recently adopted permanent regulations (8 CCR 1501-10, effective 11/14/2023) that reflect the changes made by Senate Bill 23-143, which was passed by the General Assembly on March 6, 2023, and signed by the Governor on March 15, 2023. The bill made the following modifications to the retail delivery fee system:

1. Option for retailers to pay the Colorado retail delivery fee on behalf of purchasers: The bill allows retailers to elect to pay the fee for the purchasers, instead of adding them to the price and collecting them from the purchasers. If a retailer elects to pay the fee, the purchaser is not liable or eligible for a refund of the fee, and the retailer must remit the fee to the Department of Revenue as if it had been collected from the purchaser on the date of the retail delivery.
   
   
2. Colorado retail delivery fee exemption for small businesses: As of July 1, 2023, the bill creates an exemption from the retail delivery fee for retailers who have $500,000 or less of retail sales in the prior year. The bill also prohibits refunds of any fee collected and remitted by qualified businesses before the effective date of the bill. 

“Qualified business” means a retailer that in the previous calendar year made retail sales of tangible personal property, commodities, or services in the state totaling $500,000 or less. If the retailer had no sales in the state in the previous calendar year, then the retailer is deemed to be a “qualified business” for the current calendar year, until the first day of the month after the 90th day after the retailer has made sales in the state that total more than $500,000.

The regulations also specify the amount, the collection, and the administration of the fee, which are adjusted annually for inflation and published by the Department of Revenue by April 15 of each year.