Polis Proposes Higher Tax on Colorado Casinos

Colorado Governor Jared Polis proposed, in his final budget proposal for the period when his term ends in January, raising the effective tax rate on land-based casinos from 16.1% to 23%. The goal is to use the revenue to strengthen funding for child care and preschool programs. If the proposal is accepted, the rate would move one step closer to the US average of 26%.

Estimates suggest the tax increase could bring in about $80.2 million a year from the gaming sector, or about $129 million a year including alcohol and tobacco taxes. Polis argues that since he took office in 2019, the average per-pupil education funding has risen by more than 50%, from $8,137 to $12,325. According to the governor's office, the budget adds $154.7 million in extra funding for state school finance, of which $125 million comes from the general fund.

New taxes in Colorado require voter approval. Under TABOR, the state's taxpayer bill of rights, the proposal could go to a vote in 2027. Current rules set caps ranging from 20% to 27.5% for land-based venues that earn between $20 and $100 million a year. The plan would raise this cap to 35% for the four highest-earning casinos, and these four are believed to all be in Black Hawk. Because the proposal is so recent, it is hard to predict how voters will decide. Still, voters approving Proposition JJ in 2024, which regulates how sports betting tax revenue is used, shows that they are open to certain forms of taxation.

State data shows casinos generated $97.5 million in gaming revenue in September 2026, of which $73.9 million came from Black Hawk. Home to more than a dozen gaming venues, Black Hawk is one of the fastest-growing casino markets in the country. Well-known operators in the city include Bally's, Caesars Entertainment, Monarch Casino & Resort, and Penn Entertainment.