11% Excise Tax and Online Ammo Sales with 03FFL + COE

[FourT6and2]

Didn't see much mention of this in the other threads about the 11% tax. Because out of state ammo vendors need to comply, but they don't want to collect the tax (paper work, effort, moral objection, etc.), they are now saying that all ammo sales must ship to an 07 FFL so they can collect the tax and will no longer ship directly to customers who have 03 FFL + COE. This effectively removes the exemption for those who have these.

[enorbit3]

Source??

[FourT6and2]

Source??

Me. I just tried to buy ammo from a number of vendors who I've purchased from in the past. They will only ship to 07 FFL now. Just pointing out that CA has effectively removed interstate commerce.

[Eat Dirt]

Me. I just tried to buy ammo from a number of vendors who I've purchased from in the past. They will only ship to 07 FFL now. Just pointing out that CA has effectively removed interstate commerce.

Road Trip ... just say'in

[enorbit3]

Dang. That's terrible news. I've got my ffl03 and coe. Was thinking I could avoid the tax. Hopefully CRPA steps in and get this thing thrown out.

[FourT6and2]

Road Trip ... just say'in

Not worth it. I'm not buying random bargain bin 9mm or 22LR. Only certain shops around the country carry the ammo I buy, so online is the only option. Even local shops here in CA don't carry what I need.

[FourT6and2]

Dang. That's terrible news. I've got my ffl03 and coe. Was thinking I could avoid the tax. Hopefully CRPA steps in and get this thing thrown out.

You won't avoid the tax by buying online, even if a shop will still ship to you. Out of state vendors are responsible for collecting the excise tax and remitting it.

[TAS]

Dear Customer,

Thanks for your business, MidwayUSA Customer Service

[FourT6and2]

You're missing the point. Those of us with 03 FFL and COE don't need ammo shipped to an FFL for pickup and background check and additional fees. We can have ammo shipped directly to our homes. But someone needs to collect/remit this new 11% excise tax. If the out-of-state retailer doesn't want that responsibility, then ammo will need to ship to an FFL instead, which defeats the purpose of the 03 FFL + COE exemption in the law.

That said, I did find a retailer who was willing to ship directly to me. But a number of them that would ship prior to July 1, 2024 no longer will.

[TAS]

You're missing the point. Those of us with 03 FFL and COE don't need ammo shipped to an FFL for pickup and background check and additional fees. We can have ammo shipped directly to our homes. But someone needs to collect/remit this new 11% excise tax. If the out-of-state retailer doesn't want that responsibility, then ammo will need to ship to an FFL instead, which defeats the purpose of the 03 FFL + COE exemption in the law.

That said, I did find a retailer who was willing to ship directly to me. But a number of them that would ship prior to July 1, 2024 no longer will.

[Quiet]

The 11% tax only applies to retail sales within CA and it only applies to a CA FFL dealer, CA firearm manufacturer, and CA ammunition vendor. [RTC 36011]

Out-of-state ammunition vendors are not required to collect/charge this tax because they do not meet the CA legal definition of an "ammunition vendor" [FTC 36001(a) and PC 16151] and because the sale does not occur within CA [RTC 36011].

If an out-of-state vendor sells ammunition and it is shipped to a CA FFL dealer or CA DOJ licensed ammunition vendor, then that CA FFL dealer or CA DOJ licensed ammunition vendor will collect the 11% tax because the retail sale occurred within CA. [RTC 6007(a)(2)]

If an out-of-state vendor sells ammunition and it is shipped directly to an exempt person, then no 11% tax is required because the retail sale did not occur in CA and the person receiving the ammunition is not a CA FFL dealer or CA DOJ licensed ammunition vendor. [RTC 36011]

There are no CA laws that mandates an out-of-state vendor, that sell ammunition to an exempt person in CA, to ship that ammunition to a CA FFL dealer or CA DOJ licensed ammunition vendor, so that the 11% tax can be collected.

Also note that the SCOTUS ruling, South Dakota v Wayfair (2018), only applies to sales tax and does not apply to any other type of State tax.
^This is why online vendors charge CA sales tax for items sold/ship to CA.



Revenue and Taxation Code 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.

Revenue and Taxation Code 36001
For purposes of this part:
(a) The following terms shall have the same meaning as those terms are defined in Division 2 (commencing with Section 16100) of Title 1 of Part 6 of the Penal Code:Revenue and Taxation Code 6007Penal Code 16151
(a) As used in this part, commencing January 1, 2018,
(b) Commencing January 1, 2018, a firearms dealer licensed pursuant to Sections 26700 to 26915, inclusive, shall automatically be deemed a licensed ammunition vendor, provided the dealer complies with the requirements of Articles 2 (commencing with Section 30300) and 3 (commencing with Section 30342) of Chapter 1 of Division 10 of Title 4.

Penal Code 30385Revenue and Taxation Code 36034
(a) By no later than March 31, 2024, and thereafter, by no later than the last day of each calendar quarter, the Department of Justice (DOJ) shall provide a list, including the names and business locations of all firearm dealers, firearm manufacturers, and ammunition vendors that are licensed by the DOJ or that are included on any of the centralized lists maintained by the DOJ pursuant to Sections 26715, 28450, and 29060 of the Penal Code, to the California Department of Tax and Fee Administration (CDTFA) for the purposes of administering the excise tax imposed pursuant to this part. The DOJ shall also be authorized to provide this information to the CDTFA, upon its request, for the purposes of administering the excise tax imposed pursuant to this part.
(b) The authority of the DOJ to share the information described in subdivision (a) with the CDTFA shall be in addition to, and notwithstanding any other limitations on, the authority of the DOJ to share that information under any other statute.

Revenue and Taxation Code 36035
Each licensed firearms dealer, firearms manufacturer, or ammunition vendor subject to the excise tax imposed pursuant to this part shall register for a certificate of registration with the department using electronic media in a form prescribed by the department and shall set forth the name under which the applicant transacts or intends to transact business, the location of their place or places of business, and any other information as the department may require. An application for a certificate of registration shall be authenticated in a form or pursuant to methods as may be prescribed by the department. No fee shall be charged for the application for, or issuance of, the certificate of registration.

Revenue and Taxation Code 36036
The department shall issue a certificate of registration to each eligible applicant that has properly registered pursuant to Section 36035. A certificate of registration issued pursuant to this section shall be valid until canceled or revoked.

Revenue and Taxation Code 36037
If the holder of a certificate of registration fails to comply with any provision of this part or any rule or regulation of the department prescribed and adopted under this part, the department shall provide notice in writing to the holder of the certificate of registration specifying the time and place of hearing and requiring the certificate holder to show cause why their certificate should not be revoked. The notice shall be provided no less than 10 days before the hearing and may be served personally or by mail in the manner prescribed for service of notice of a deficiency determination. The department may, after notice and hearing, revoke a certificate of registration for any such violation or omission, and notify the Department of Justice of the revocation.

[abinsinia]

I wonder when the lawsuit drops.

[CessnaDriver]

Well just now I bought some TargetSportsUSA with my FFL03 on file. Regular ol tax so far.

[Zenderfall]

That said, I did find a retailer who was willing to ship directly to me. But a number of them that would ship prior to July 1, 2024 no longer will.

[Zenderfall]

Well just now I bought some TargetSportsUSA with my FFL03 on file. Regular ol tax so far.