# Colorado Governor Proposes Higher Casino Taxes, Raising Concerns for Gaming Operators

Colorado's casino industry could face a substantial tax increase under a proposal introduced by Governor Jared Polis as part of his final state budget.

The plan, announced November 2, would raise the industry's effective gaming tax rate from approximately 16.1% to 23%, generating an estimated $80.2 million in additional annual revenue.

The money would help fund childcare and preschool programs as Colorado faces a projected $1.6 billion budget shortfall for the 2027-28 fiscal year.

**Colorado's Largest Casinos Would Pay More**

Under the proposal, Colorado would introduce new tax brackets based on each casino's annual adjusted gross gaming proceeds, essentially the money collected from gamblers after paying out winnings.

Casinos earning between $20 million and $100 million annually would face higher tax rates, with the top bracket reaching 27.5%.

The state's four highest-grossing casinos, each generating more than $100 million annually, could face a top marginal tax rate of 35%.

Those are marginal rates, meaning they would apply to portions of gaming revenue within the applicable brackets, not necessarily to every dollar earned by a casino.

The proposed changes would bring Colorado's overall effective gaming tax rate closer to the national average, which state officials estimate at approximately 26.5%.

Combined with proposed increases in tobacco and nicotine taxes, the governor's plan would generate an estimated $128.9 million annually for early childhood education and childcare assistance.

**Black Hawk Would Feel the Greatest Impact**

Colorado's commercial casinos operate in three historic mountain communities: Black Hawk, Central City and Cripple Creek.

Casino gambling began in those communities in 1991, and the industry has grown considerably since then.

Black Hawk is now the state's largest casino market, home to properties operated by companies including Caesars Entertainment, Bally's, Monarch Casino & Resort and Penn Entertainment.

According to Colorado gaming figures, the state's casinos generated approximately $97.5 million in gaming revenue during September 2026.

Black Hawk accounted for approximately $73.9 million of that total, or nearly 76% of statewide gaming revenue.

With the largest concentration of gaming revenue, Black Hawk's major properties would likely bear much of the additional tax burden.

Central City and Cripple Creek could also be affected, depending on the revenue generated by individual properties and how the final tax brackets are structured.

**Casino Industry Reviewing the Proposal**

The Colorado Gaming Association has acknowledged the proposal but has not yet taken a formal public position supporting or opposing it.

The association said industry leaders are reviewing the details and expect changes as a new governor takes office.

Higher gaming taxes could reduce the money casinos have available for property improvements, expansion and other investments. Whether that would lead to changes in employment, amenities or customer promotions remains uncertain.

Supporters of the proposed increase argue that the additional revenue would help address the cost and availability of childcare, an issue affecting working families throughout Colorado.

**Voters Would Have the Final Say**

The proposed increase is far from becoming law.

Colorado's Taxpayer's Bill of Rights, commonly known as TABOR, generally requires voter approval for new tax increases.

That means the gaming tax proposal could ultimately appear on a statewide ballot in 2027.

There is another complication. Polis is term-limited and will leave office in January 2027, before the proposed budget takes effect.

His successor and the Colorado Legislature will have considerable influence over whether the proposal moves forward, is modified or is abandoned.

For now, Colorado's casinos continue operating under the existing tax structure.

**A Familiar Debate in the Casino Industry**

Casino taxation has long been a balancing act for states that permit commercial gambling.

Gaming revenue provides funding for public programs, local governments and other services. At the same time, casinos argue that excessive taxation can discourage investment and make it more difficult to compete with gaming properties in neighboring states.

Colorado's proposal brings that debate back into focus.

For casino operators in Black Hawk, Central City and Cripple Creek, the next several months will determine whether the proposed increase gains political support.

For the state, the question is whether casinos should contribute more toward education and childcare programs.

And for Colorado voters, the final decision may eventually be theirs.