Politics
Pueblo Grocery Sales Tax Exemption Referendum: Effects on Household Food Spending
Pueblo residents would stop paying the 2.9 percent city sales tax on most grocery items if the November ballot measure passes, according to the county fiscal impact statement.
How we reported this
The Pueblo County Clerk’s office has placed a referendum on the November 2026 ballot that would exempt groceries from the city’s 2.9 percent sales tax. The measure applies to food purchased for home consumption at stores within city limits and would take effect January 1, 2027, if approved by voters.
City budget papers show grocery sales tax collections reached $4.2 million in fiscal year 2025. Rising food prices tracked by the Bureau of Labor Statistics have increased the share of household income spent on groceries in Pueblo County over the past two years, prompting local advocates to place the exemption on the ballot.
A household that spends $600 a month on groceries would avoid roughly $17 in monthly city sales tax under the proposal. Larger families or those with higher food budgets would see larger dollar savings, while the change would not apply to prepared foods, alcohol or non-food items still subject to the tax.
Revenue and service considerations
The same fiscal impact statement projects a $4.1 million annual reduction in city general fund revenue if the measure passes. City documents list public safety, street maintenance and parks as the primary uses of that revenue stream in the current budget. The statement notes the city would need to identify other funding sources or adjust spending to offset the loss.
Policy analysts at the Colorado Municipal League have examined similar local tax exemptions in other Front Range cities. Their review found that grocery exemptions typically shift a larger share of the tax burden onto non-food retail purchases without changing overall city revenue targets in the short term.
Voter timeline and information sources
Ballots will be mailed to registered Pueblo voters beginning October 12. The county clerk’s office will host two public information sessions on the measure, scheduled for August 19 and September 16 at the Pueblo Convention Center. Full text of the referendum and the fiscal impact statement are posted on the county elections website.