What are the impacts of a local employment tax on the Boulder economy?

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The anticipated results from the creation of a "head" tax on local businesses will affect virtually every business, employee, and resident of Boulder. The impacts will be felt due to:

• increased prices for many goods and services for local residents and visitors,
• lower competitiveness for new and existing firms, and
• a reduced labor supply in a normal economy.

These impacts will be spread through the economy, and will likely result in

1. lower levels of job creation and growth within the community compared to a no head-tax future,
2. increased compliance costs for doing business in Boulder, and
3. reductions in the comparative profitability of businesses.

Firms will have "one more reason" to reconsider expanding within or relocating to the City of Boulder.

Our analysis suggests that a local employment tax will create a wealth transfer from lower and moderate income residents to middle and higher income households in Boulder. This transfer will also flow from local lower wage employees and nonresident employees.