Carryout Bag Fees - Effective January 1, 2023
Beginning January 1, 2023, Colorado implemented a required 10-cent fee for plastic and paper carryout bags used at checkout as well as for pickup and delivery orders. This will affect large retail stores, for example, grocery stores and home improvement stores, department stores, and more. The state law does not affect small stores with three or fewer locations in Colorado.
Find additional information concerning House Bill 21-1162 on the State of Colorado General Assembly's website.
Please note that the City of Castle Pines has exempted the 10-cent fee from its local sales tax. If you have any questions, please email email@example.com or call 303-705-0210.
Frequently Asked Questions
Who is required to collect the carryout bag fee?
House Bill 21-1162 applies to:
Large retail stores, including convenience stores, liquor stores, dry cleaners, pharmacies, drug stores, clothing stores, or other types of retail establishments at which carryout bags are traditionally provided to customers. It may also include farmers' markets, roadside markets/stands, festivals, or other temporary vendors.
The law does not apply to:
Small stores that operate solely in Colorado, have three or fewer locations in the State, and are not part of a franchise, corporation, or partnership that has physical locations outside of Colorado.
Retail food establishments: retail operations that store, prepare, or package food for human consumption or serve/otherwise provides food for human consumption to consumers directly or through a delivery service, whether such food is consumed on or off the premises or whether there is a charge for such food.
When is the carryout bag fee due?
While the payment of the bag fees is not required until April 1, 2024, businesses may pay the fees collected before that date.
They will be due on a quarterly basis (on the 20th day of the month following the end of the quarter).
What is a carryout bag?
A carryout bag means a bag that is provided to a customer at a store (at the point of sale) for use by the customer to transport or carry purchased items. A carryout bag does not include:
- A bag made of paper when the paper has a basis weight of thirty pounds or less.
- A bag that a pharmacy provides to a customer purchasing prescription medication.
- A laundry, dry cleaning, or garment bag.
- A bag that a customer uses inside a store to:
- Package loose or bulk items, such as fruits, vegetables, nuts, grains, candy, or greeting cards; nails, bolts, screws, or other small hardware items; live insects, fish, crustaceans, mollusks, or other small species; and bulk seed, bulk livestock feed, or bulk pet feed.
- Contain or wrap frozen foods, meat, seafood, fish, flowers, potted plants, or other items that, if they were to come in contact with other items, could dampen or contaminate the other items.
- Contain unwrapped prepared foods or bakery goods.
What is the reason for the fee on disposable bags?
The State of Colorado adopted the Fee on disposable Bags to reduce environmental impacts caused by disposable bags. A mandatory fee on disposable bags has been shown to significantly reduce the number of disposable bags used.
How much is the fee?
The fee is ten cents ($0.10) per disposable bag (plastic, paper, or other material including but not limited to compostable material) provided at the checkout.
Where will the paper bag fee go?
Monies from the disposable bag fee will be split 40/60 between the retailer and the City of Castle Pines. The City is required to use the fees for the administration and enforcement costs incurred resulting from this new law or to support further efforts for recycling, composting, or other waste diversion programs and related outreach and educational activities.
Do I have to pay sales tax on the bag fee?
No, customers should not be charged sales tax on the 10-cent bag fees, for retailers that are required to collect and remit the fee to the City.
What if I’m a retailer that would like to be a part of this but are not required to?
If your business is not a major retailer or covered under the ban and bag fee you may not collect the 10-cent fee from customers for remittance to the City.