As a Federal Firearms License (FFL) dealer in California, it’s essential to keep our clients informed about the tax obligations associated with firearms and ammunition sales. Understanding these taxes ensures that you are aware of the costs involved when purchasing firearms and ammunition.
Sales Tax Overview
In California, a statewide sales tax of 9.125% is applied to the sale of firearms, firearm parts, ammunition. This tax applies to all sales, whether the transaction occurs in a store or through a private sale between individuals. Importantly, this sales tax is mandatory regardless of the seller’s status—FFL dealer or private individual. WE DO NOT COLLECT TAXES for PPT since this is between two individuals. However, sales between two individuals, whether it is in state or out of state will incur sales and excise tax. Example, John Doe from California sent a rifle to his buddy in Sunnyvale, California through our shop, this will incur sales/excise tax. Gift are not entirely exempted from sales / excise tax and it entirely depends on the situation.
For example, a seller from Kansas charges you sales tax from their state, then you still owe sales tax here in California. State tax from other states does not apply here in California. Please check with the seller before you purchase.
Excise Tax Details
In addition to the sales tax, California imposes an excise tax of 11% on the sale of firearms and ammunition. This excise tax is a specific tax levied on certain goods, designed to regulate the sale of items that have significant societal implications, such as firearms (we believe this to be unconstitutional but it’s currently the law that we must follow).
Responsibilities of FFL Dealers
As an FFL dealer, we are required to collect both the sales tax and the excise tax from your customers at the time of sale. If we fail to collect these taxes, we are still liable for paying them to the state. This obligation underscores the importance of accurate record-keeping and diligent tax collection practices in our business operations.
Key Points for Clients
- Total Tax Impact: When purchasing firearms or ammunition, customers should anticipate a total tax of 20.125% (9.125% sales tax + 11% excise tax) added to their purchase price.
- Tax Collection: All dealers, regardless of whether they are retail stores or private sellers, must ensure that the appropriate taxes are collected during a sale.
- Compliance: It is crucial for FFL dealers to stay compliant with California tax regulations to avoid penalties and ensure smooth business operations.
Here’s more information if you want to read more about the taxes we collect:
Tax Guide for Sellers of Firearm and Ammunition Products (ca.gov)