HB 25B-1005 is a straightforward tax increase disguised as administrative reform, eliminating the long-standing 4% state sales tax vendor fee—capped at $1,000 per filing period—that retailers have relied on since 1935 to offset the costs of collecting and remitting taxes on Colorado's behalf. By removing this $56.5 million annual allowance that businesses retained in 2024, the state will pull an additional $56.8 million directly from retailers starting in 2026, with small businesses hit hardest since the fee represented a critical reimbursement for paperwork, compliance, and banking expenses. Facing this sudden loss of what was effectively a tax credit for performing a government function, many small retailers—already operating on thin margins—will have no choice but to raise prices on consumers to recover the lost revenue, effectively passing Colorado's tax hike onto everyday shoppers while the state redirects the windfall to housing grants and general spending.