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Bill changing Colorado's 27-cent delivery fee passes out of key Senate committee

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Joe Mueller

(The Center Square) – A bill modifying a 2021 law requiring collection of delivery fees in Colorado passed unanimously out of the Senate Finance Committee and is headed to the Appropriations Committee.

Senate Bill 23-143 would create an exemption for new businesses and small businesses with $500,000 or less in retail sales annually. It would also permit a retailer to pay a 27-cent fee on behalf of the purchaser. The bill is retroactive to July 1, 2022. However, purchasers are not eligible for a delivery fee refund.

The bill would require specified retailers to remit the fee on the date it would have been received from the purchaser upon delivery. The retailers would not be required to add the fee to the price of the retail delivery, separately itemize the fee or collect it from the purchaser. Those purchasing goods aren’t liable for the fee under the proposed legislation and aren’t eligible for any refunds of erroneously paid fees.

“This bill will bring true economic relief for hardworking Coloradans by giving retailers the option to pay burdensome fees – created by the Democrats – on behalf of the consumer,” Sen. Kevin Van Winkle, R-Highlands Ranch, and one of the bill sponsors, posted on social media. “While we would have liked to see this fee completely eliminated, this bill represents a step in the right direction.”

In 2021, Senate Bill 21-260 established several new fees to fund Colorado’s transportation system. All deliveries by motor vehicle to locations in Colorado with at least one item of tangible personal property subject to state sales or use tax are also subject to a retail delivery fee. The retail or marketplace facilitator collecting the sales or use tax on the tangible property sold and delivered, including by a third party, is liable for collecting and remitting the fee. Deliveries include any taxable goods mailed, shipped or otherwise delivered by motor vehicle to a purchaser in Colorado.

“Small businesses bring valuable goods and services to our communities, create good jobs across the state, and contribute to Colorado's strong economy,” Senate President Steve Fenberg, D-Boulder, said in a statement. “Senate Bill 143 is a win-win for small businesses and consumers alike. It helps Colorado’s small businesses continue to thrive, simplifies the delivery fee collection processes, and eases the fee burden on consumers.”

The retail delivery fees, administered by Colorado’s Department of Revenue, are distributed to the Highway Users Tax Fund, the Multimodal Transportation and Mitigation Options Fund and five enterprises, including promotion of electric vehicles and electric mass transit.