Starting January 1, 2022, retailers with $1 million dollars or more in total taxable sales for any filing period will NO longer be eligible for the State’s portion of the vendor fee. The vendor fee is the amount the retailer generally may deduct and retain from the collected tax to cover their expenses in the collection and remittance of the tax. This change appears only to apply to the vendor service fee on the State’s 2.9% sales tax.

Some State-administered local jurisdictions allow retailers to retain a vendor service fee from the collected local taxes. The  service fee percentages vary by jurisdiction. See Department publication Colorado Sales/Use Tax Rates (DR 1002) for service fee percentages for state-administered local sales taxes.

For more details, see the Retailer’s Service Fee information in the Colorado Sales Tax Guide  under Section 7: Filing and Remittance.