11% excise tax

[Quiet]

AFAIK...

The 11% tax will apply to firearms and ammo in the CA FFL dealer's inventory starting 07-01-2024.

Because of the 10 day wait, a firearm that is DROS'd after 06-20-24 will cause the firearm to remain in the CA FFL dealer's inventory after 06-30-24 and the 11% tax will be imposed on it due to being in the CA FFL dealer's inventory starting 07-01-24.

Starting 07-01-2024, firearms and ammunition shipped to a CA FFL dealer and received into their inventory will cause the 11% tax to be collected on it.

[Zenderfall]

AFAIK...

The 11% tax will apply to firearms and ammo in the CA FFL dealer's inventory starting 07-01-2024.

Because of the 10 day wait, a firearm that is DROS'd after 06-20-24 will cause the firearm to remain in the CA FFL dealer's inventory after 06-30-24 and the 11% tax will be imposed on it due to being in the CA FFL dealer's inventory starting 07-01-24.

Starting 07-01-2024, firearms and ammunition shipped to a CA FFL dealer and received into their inventory will cause the 11% tax to be collected on it.

[Eddy's Shooting Sports]

If you are buying ammunition with an FFL03/COE and then consuming it yourself, you are obligated to pay the appropriate sales tax when you file your state tax return, unless the tax was collected by the seller you got it from. I'm not exactly sure how this relates with the FET, but I would just keep your mouth shut and hope for the best. Most likely the tax will be due, but the question is, what would the enforcement mechanism be.


As for implementation of the tax, most of the recent commenters would be well suited to go back and read the posts earlier in the thread. Sales tax law is very clear that the tax is levied at the time of delivery of the goods. FET will be the same and will be remitted to CDTFA, just like sales tax. When you "buy" a gun, you are essentially just placing a deposit on the product until it is delivered, at which point the final sale is made and the tax collected per the rate in force on that day. This isn't rocket surgery, but it is understandable that the average layperson does not know how this works. Bottom line, don't get pissed at your FFL, big or small, if you have to pay the tax on something DELIVERED on July 1st or after.

[Grendel Guy]

Just thought of something. My bil passed away recently. His firearms (he had no will/trust) would be passed on to his only son that expressed interest on them. Would a tax be imposed on him?

[TrappedinCalifornia]

If you are buying ammunition with an FFL03/COE and then consuming it yourself, you are obligated to pay the appropriate sales tax when you file your state tax return, unless the tax was collected by the seller you got it from. I'm not exactly sure how this relates with the FET, but I would just keep your mouth shut and hope for the best. Most likely the tax will be due, but the question is, what would the enforcement mechanism be.


As for implementation of the tax, most of the recent commenters would be well suited to go back and read the posts earlier in the thread. Sales tax law is very clear that the tax is levied at the time of delivery of the goods. FET will be the same and will be remitted to CDTFA, just like sales tax. When you "buy" a gun, you are essentially just placing a deposit on the product until it is delivered, at which point the final sale is made and the tax collected per the rate in force on that day. This isn't rocket surgery, but it is understandable that the average layperson does not know how this works. Bottom line, don't get pissed at your FFL, big or small, if you have to pay the tax on something DELIVERED on July 1st or after.

This isn't just about "laypeople." At least one of the long time shops in this area disagrees with you; but, is hoping more specifics will be forthcoming from DOJ before 1 July.

Meanwhile, comparing this to a sales tax actually adds to the confusion. If you go back and read the bill, the tax is not supposed to be on end consumers like a sale tax is; which is part of the reason I've had problems with talk of a separate line on the sales receipt.

36011. Commencing July 1, 2024, an excise tax is hereby imposed upon licensed firearms dealers, firearms manufacturers, and ammunition vendors, at the rate of 11 percent of the gross receipts from the retail sale in this state of any firearm, firearm precursor part, or ammunition.

We all get and have always understood that businesses aren't going to eat the tax and will pass it along to the consumer as a cost of doing business. But, according to the language used, the tax is being imposed on the business, not the consumer. Thus, it is the business which is passing along the tax to the consumer. That means we're not 'pissed at our FFL' because the Government is imposing a new tax. We're upset because there is no, uniform consensus on how this will be implemented... Meaning that different FFL's currently have different opinions and are adding to the confusion in terms of how they, at the moment, claim they'll be dealing with this.

Most, like you, are putting out a cut off date of 20 June for the DROS. However, that brings us to another thing which is 'confusing' both consumers and retailers. When is the 'retail sale' actually complete? Your view is that the monies received "act like" a deposit pending delivery. Okay. That's one interpretation. Other retailers view it as the actual "sale" having been completed prior to being able to run DROS, which is Government granting permission for the individual to take possession. Such is why there is so much consternation when approval is delayed or denied and restocking fees are charged. The question is whether the actual "sale" is bad or if there was a problem in the 'permission process' from the Government for taking possession.

In short, you are correct. It is not supposed to be 'rocket science.' But, without further clarification, caveats such as "essentially" and "deposit" when the bill is actually marked "paid in full" on most receipts prior to the DROS being run and the DROS not being, technically, part of the 'final sale,' just Government permission to take actual possession, and the tax not being placed on the consumer, but on the dealers, manufacturers, and vendors, who then 'pass it on' to the consumers... The issue becomes the clouded mess we currently have.

Ultimately, you may be proven correct and I get your frustrations. We appreciate you presenting the 'interpretation' which is currently the prevailing one. What I'm saying is be careful with this being beyond the "average layperson," insinuating that it is something "well understood" by FFL's. It's not and there is a certain lack of uniformity, currently, in terms of agreement on interpretation as to how this is going to work. There's even disagreement in one shop over when some clarification is supposed to be forthcoming from DOJ; which, in and of itself, suggests the lack of uniformity in 'understanding' amongst retailers if DOJ is planning 'clarification.' (I'm just going with what one long-time FFL holder/shop is saying on that score.)

[cz74]

If we do see a specific line item with the 11% excise tax, we should be able to file a complaint with the Board of Equalization, and then watch the clown show start from there.

[reddot15]

Since this is a excise tax are prices just going to be increased to reflect the 11% dealers have to pay or is it going to be added as an additional tax on the invoice? I am wondering because I will be DROSing another firearm in June which I will pay in full at time of order but pick up will be after July 1st.

To the best of my understanding (from the Turner's sales representative), the 11% tax will be in addition to the regular sales tax. If you do not complete the DORS process for the firearm by6/20/24, you will be subject to the new tax. Unfortunately, I will have to pay the 11% excise tax next month when I complete the DORS at Turner's, even though everything was paid in full last week.

[Raptor3000]

Quick question, even gun cleaner and gun oil will be charged extra 11% right?

[yacko]

If we do see a specific line item with the 11% excise tax, we should be able to file a complaint with the Board of Equalization, and then watch the clown show start from there.

mandatory other than taxes or government fees and shipping fees, with limited exceptions. In short, SB 478 makes it illegal to advertise a low initial price for a product or service and then charge additional mandatory fees later in the checkout process."

?All mandatory fees other than taxes or govt fees.....

Well just list the taxes and govt fees anyway to super comply with the law. Then an invoice shows the fee the govt charged = poll tax.

[jayhuh]

Quick question, even gun cleaner and gun oil will be charged extra 11% right?

[jayhuh]

If we do see a specific line item with the 11% excise tax, we should be able to file a complaint with the Board of Equalization, and then watch the clown show start from there.

[Supersapper]

Wanna bet? The people up in Excremento haven't done things in accordance with law, statute, or public vote in years. Why should they change now? It'll go to whatever anti-gun propaganda they come up with next. I remember one person here said that following this all the way around, we are actually going to be funding the fight against us with all of these taxes.

[DJD100]

So weapon sights, lights, and lasers should be immune to this BS tax, correct?

[jayhuh]

^^^
The bill says, firearms, ammo and precursor parts. Precursor parts are defined generally as lower receivers and barrels.

[kenl]

^^^
The bill says, firearms, ammo and precursor parts. Precursor parts are defined generally as lower receivers and barrels.

According to the DOJ's guidebook, barrels are not precursor parts. Only unfinished frames are targeted.

https://oag.ca.gov/system/files/media/bof-reg-rev-fpp-id-guidebook.pdf