California Begins Excise Tax on Firearms, Firearm Precursor Parts and Ammunition
If you sell firearms, firearm precursor parts, ammunition or related accessories, you must register with the California Department of Tax and Fee Administration to get a seller's permit, file sales and use tax returns and make payments for tax due on your sales or purchases.
Beginning July 1, 2024, if you are or plan to be, a licensed firearm dealer, ammunition vendor, or firearms manufacturer who makes or plans to make retail sales (that is, sales to consumers) of firearms, firearm precursor parts, or ammunition in California (R&TC section 36035) you must also register with us for a California Firearm and Ammunition Excise Tax (CFET) Certificate of Registration, file CFET returns, and make payments for the excise tax due.
You can use California's online registration system to register for a seller’s permit and a CFET certificate of registration.
Importers, manufacturers, and dealers (retailers) of firearms in the United States must first register with the United States Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) to obtain a Federal Firearms License (FFL) before making any sales of firearms. It is unlawful for any person other than a registered FFL holder to make sales or transfers of firearms between private parties or across state lines.
In addition to being granted an FFL by the ATF, retailers of firearms and ammunition and firearms manufacturers in California need to apply with the State of California Department of Justice (DOJ) and obtain the appropriate certification and licensing before making sales or transfers. Generally, to apply with DOJ you must first obtain a seller's permit and a CFET certificate of registration from us, in addition to other documentation requirements. For more information, please see DOJ's Frequently Asked Questions.
The California Firearms, Firearm Precursor Parts, and Ammunition Excise Tax (CFET) is imposed on the gross receipts of retail sales (for example, sales to consumers) in California of any firearms, firearm precursor parts, or ammunition made by licensed firearms dealers, firearms manufacturers and ammunition vendors at the rate of 11 percent (R&TC section 36011).
For the purposes of the CFET, gross receipts include the sales price of the firearms, firearm precursor parts, or ammunition and all charges related to the sale, such as any business expense separately added to any taxable sale listed separately on the invoice or receipt provided to the purchaser. State fees collected at the time of retail sale that are paid by the purchaser (for example, DOJ Firearms Dealer Record of Sale (DROS) fee, Firearms Safety fee and Safety and Enforcement fee) and that are listed separately on the invoice or receipt provided to the purchaser are not subject to the CFET and should be excluded when calculating the CFET. Also, sales and use tax separately stated on the invoice or receipt should not be included in the gross receipts for CFET.
NSSF urges all California members to become thoroughly acquainted with the new CFET regulations. |
