No. The law explicitly states that the funds kept by the stores from this fee do not count as revenue and are not subject to sales tax.
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Starting January 1, 2023: “Large Stores” * are required to charge a $0.10 fee on each single-use carryout paper and/or plastic bag. On a quarterly basis, stores remit (pay) $0.06 of what they collected to the City of Grand Junction, and the stores keep $0.04.
Starting January 1, 2024: “Large Stores” are not allowed to purchase plastic carryout bags but may still charge the $0.10 fee for plastic bags purchased prior to that date. On June 1, 2024, all plastic carryout bags will be banned in large stores. Also, starting in 2024, polystyrene food containers are banned at all retail establishments, with no exemptions.
A single-use carry-out bag is just what it sounds like: a paper or plastic bag that customers use to put items in as they leave a store at check-out. These do not include small and lightweight bags to collect items inside a store like produce, bulk food items, deli items, bulk seed/feed, or prescription medications.
Paper carry-out bags must be made from 100% recycled material or postconsumer content.
“Large Stores” are affected by this law. These are those with more than three locations and/or that are part of a franchise, corporation, or partnership with a physical location outside of Colorado.
This means that any store, regardless of type, does not need to comply if it operates solely in Colorado, has three or fewer locations in the state, and is not part of a franchise, corporation, or partnership that has physical locations outside of Colorado. This is commonly referred to as the small business or independent business exemption.
Retail food establishments do not need to comply if they prepare or serve food in individual portions for immediate on- or off-premises consumption; however, this exemption does not apply to grocery stores or convenience stores, and they must still comply. This is commonly referred to as the food service or restaurant exemption.
All stores are affected, no exceptions.
If you bring your own reusable bag and do not use a single-use carryout bag, you can avoid paying the fee.
Also, customers that can show proof of being on a federal or state food assistance program do not have to pay the fee.
Customers who believe a store is not charging the fee or is improperly offering refunds or discounts that offset the fee can report the store to the City of Grand Junction Sales Tax by calling 970-244-1521.
All impacted stores must display a sign notifying customers of this program.
Stores must keep records of fees collected and must include the bag fee as an itemized line on customer receipts, accounting for the total number of bags used at the time of purchase. This fee is not subject to tax and so will not affect the sales tax amount shown on the receipt.
Stores are allowed to retain $0.04 of the collected fee and must remit (pay) $0.06 to the City of Grand Junction.
No. The law does not outline what the store can or should do with this fee revenue.
The funds will support the community-wide distribution of reusable bags and education on the value of reducing reliance on single-use carryout bags. Funds may also be used to support any recycling, composting, or other waste diversion programs and related outreach and education activities.
Stores must remit payment to the City of Grand Junction on a quarterly basis.
For example, if your store collected $100 in bag fees between January 1 and March 31, you would submit a payment of $60 to the City of Grand Junction within the first week of April. If your store then collected $200 worth of fees between April 1 and June 30, you would remit $120 during the first week of July, and so on.
It is recommended remittance begin as early as April 2023 but must occur no later than April 2024. The first remittance payment must account for all fees collected starting January 1, 2023, subject to council direction. After April 2024, remittance must occur regularly on a quarterly basis. The city is considering adopting an ordinance that requires remittance starting in April 2023. Please note that if this occurs, we will be in direct contact with stores.
If the first payment is delayed, it must still account for all collected fees starting on January 1, 2023, up to that point. For example, if a store delays their remittance payment until July 2023, that remittance payment must still account for the bag fees collected during the first two quarters of 2023.
The rules for which stores are and are not affected by this law are automatic, which can be confusing for stores that would like to opt-in to a program to discourage single-use carryout bags.
There are multiple options for stores that wish to reduce single-use carryout bags:
Stores that are exempt from state law are allowed to charge their own self-imposed charge on carryout bags if they wish. The City of Grand Junction recommends this be a $0.10 fee to align with other stores in our community. Stores in this case are allowed to retain 100% of the revenue from this charge and do not have to remit any amount to the City of Grand Junction. However, this charge would be subject to sales tax as it would be categorized as a sale of an item: in this case, the store is selling a carryout bag for $0.10 each.
Yes, but this is not subject to the 4 cents of tax-free revenue as noted in HB21-1162. If you charge 10 cents on anything other than a plastic bag or paper bag that is a taxable item and must incur sales tax.