Like the State of Colorado, Lincoln County has a tax structure that encourages growth. The state sales tax rate is 2.9% and the Lincoln county sales tax rate is 2.0%. This tax rate includes towns such as Arriba, Genoa, Hugo, Limon and Karval.

According to the Tax Foundation's 2008 Business Tax Climate Index, Colorado ranked 13th most business friendly tax climate. In State and Local tax burden as a percentage of income in 2007, Colorado ranked 30th. Colorado was also 23rd lowest in total tax burden for state, local, and federal taxes as a percentage of income.

Colorado's referendum C allows the state to retain excess tax revenues and permits the state to spend it on K-12 education, healthcare, higher education, and transportation projects. This allowed Colorado to invest in the future without raising taxes.

In 2008 Governor Bill Ritter signed into law several bills that boost economic development for Colorado. According to the official press release:

• HB 1225 exempts 30,400 additional businesses from Colorado's Business Personal Property Tax. Currently, businesses are exempt from paying the tax if they have personal property such as computers and other equipment worth less than $2,500. HB 1225 raises the exemption threshold to $7,000 over five years.
• HB 1380 simplifies Colorado's corporate tax structure by establishing a "single sales factor" for multi-state corporations. This is the most comprehensive income tax reform in Colorado in more than four decades. It creates an incentive for companies that want to build their workforce and increase their physical presence in Colorado, and it rewards companies currently investing in the people and infrastructure of Colorado.
• HB 1261 abolishes Colorado's "fly-away" sales tax on airplanes made in Colorado but sold to out-of-state owners. This will be a tool to entice aircraft manufacturers to Colorado.
• HB 1183 will make it easier for businesses -- especially small rural businesses -- to qualify for job-creation incentives through the state's Performance-Based Incentives Fund.

Colorado also offers various tax incentive programs to companies that create new jobs and investment in the state.