Beginning July 2024, Chapter 231 of 2023 (AB 28, Gabriel) imposed an 11 percent excise tax on retail sales of firearms, firearm precursor parts, and ammunition, with some exemptions. We described this tax in more detail in a recent post.
Administration Reduced Revenue Estimate in January. As Chapter 231 went through the legislative policy process, the administration preliminarily estimated that the new firearm and ammunition excise tax would raise $159 million in 2024-25. In May 2024, the administration revised its estimate to $103 million. In January 2025, the administration revised its estimate to $56 million.
Preliminary Total For First Half of 2024-25: $29 Million. For firearm and ammunition excise tax returns filed for the first two quarters of 2024-25, the total amount of tax due is $29 million. Preliminary revenues tend to differ modestly from actual revenues for various reasons, such as delays in filing or payment. In this case, however, the preliminary numbers likely understate actual revenues more than usual due to wildfire-related filing delays.
Administration’s January Estimate Still Reasonable. In the post noted earlier, we assessed the administration’s $56 million January estimate as “reasonable,” though it incorporated just one quarter of preliminary revenue data. We now have more data, but the number for the most recent quarter is difficult to interpret. Revenue still could turn out to be substantially higher or lower than $56 million, but 2024-25 revenue above $90 million is looking increasingly unlikely.