Retail sales of guns and ammunition will soon be subject to a new state excise tax in California. Under Assembly Bill 28, which Governor Gavin Newsom signed into law on September 26, 2023, an 11% tax will apply to gross receipts from retail sales of ammunition, firearms, and firearm precursor parts starting July 1, 2024. Revenue generated by the tax will be deposited in a new Gun Violence Prevention and School Safety Fund.
California’s new gun tax is similar to the federal firearms and ammunition excise tax (FAET), which was first implemented in 1919 and is administered by the Alcohol and Tobacco Tax and Trade Bureau (TTB). The FAET is 10% of the manufacturer’s price for pistols and revolvers, and 11% of the manufacturer’s price of other portable weapons, shells, and cartridges. It applies to firearms and ammunition for domestic use barring certain exemptions, for example, businesses producing fewer than 50 guns per year are exempt from the FAET.
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