Federal Fishing Equipment Excise Tax
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Happened across something I did not know today. Most fishing equipment we use is subject to a 10% excise tax by Uncle Sam upon its domestic manufacture or import. Pretty surprising to me that fishing equipment is in the same category as booze, cigarettes, explosives and gasoline (ok, ok, ok – someone could argue the “things i hope to use each weekend” similarity on these). Also surprised that there is not more buzz on this, though the money apparently goes towards hatcheries, etc.
For a shockingly detailed list of what is taxable, see this link (e.g. subject: Creels, Nets (Landing) and Fishfighting Chairs; Not subject: Nets (Casting), Practice Fly Rods and Fish tank aerators)
http://www.irs.gov/businesses/small/article/0,,id=203117,00.html
There is no surprise about the excise tax on fishing equipment, fisherman lobbied Congress for years to get it passed.
There is a big difference between the government soaking us and the government allocating funds that benefit us.
The state of Missouri has a taxation system specifically designated for conservation/wildlife.
It was initiated in 1937(?) where a 1/8 cent excise tax was imposed on all hunting and fishing equipment including stamps and licenses.
This designated income allowed the Missouri Department of Conservation to thrive and become the envy of most other states…an allocated guaranteed income for the specific use of the conservation department to develop and maintain our lands and wildlife.
Over the years the Missouri legislature has tried time and again to raid the fund and each time they have been turned away either by law, voters, or both.That puts the dollars generated as close as possible to the dollars spent, which helps oversight immensely and lets the people being taxed feel like their taxes are being used to benefit them.
Zach
There is an economic benefit to these taxes – http://www.fws.gov/fisheries/nfhs/rainbowtrout.htm
…It was initiated in 1937(?) where a 1/8 cent excise tax was imposed on all hunting and fishing equipment….
This sounds very much like so-called Pittman-Robertson and Dingell-Johnson Acts. Through those acts, excise taxes from the sale of sporting equipment fills a general federal pot which is granted to states to fund (or match) projects in wildlife and fisheries. Funds are granted based on a formula that includes the number of license holders in a state. States have to be in compliance with some broad rules (all states are, I think).
The P-R Act was instrumental in restoring white-tailed deer, wild turkey, river otters, and other game/furbearing species in the southeast after they were nearly extinct following uncontrolled market hunting during the Great Depression. I couldn’t find a list of where GA spends these funds, but it looks like many states use them to fund hunter education programs, boat ramp maintanence, etc. My impression is that this money is highly reliable and can be counted on, basically, to fund line-item budget needs.
I’m pretty sure what Scott is talking about is Dingell-Johnson (D-J) money and it has been around quite a while.
I have no problem paying taxes for proper government services. I just want to know how much I am paying and what I’m getting for it.
A very big issue with “proper government services” is that the 300 million or so tax payers in this country have about 300 million different definitions for “proper Government services”.
I am still opposed to hidden taxes (excise taxes, gas taxes, VAT, etc.). Citizens should know what they are paying to support the government. Also, I am skeptical of “earmarked” taxes. There is plenty of evidence that “earmarked” taxes simply replace reductions from the general fund, so the net effect is the same funding for the sector the funds are “earmarked” for, but more money going into the general fund.
Licenses are a different animal, since people know what they are paying, like sales taxes and income taxes.
I have no problem paying taxes for proper government services. I just want to know how much I am paying and what I’m getting for it.
That’s a very reasonable point, Bob.
I just want to know how much I am paying and what I’m getting for it.
Bob, this might fall under the old saying …be careful what you ask for, you just might get it.
Just looking at state government, and I will be using GA as an example (FLA should be very similiar). The State budget is compiled by the Office of Planning and Budget (OPB) from budgetary request reports compiled by the fiscal officers of each separate State Agency or Unit of State Government. There are at least 40 people who work full time analyzing these request, reviewing cost trends, and reviewing YTD expenditures as compared to budget. The budget document (Appropriation Act ) is printed on legal paper (both sides) and is about a 1/2 inch thick and there is a “Tracking Document” equally as large that tracks changes made by the General Assembly as the Act works its way to being passed. The detail of the Act is Unit of Government then line item of expenditure. Where, as an example, DOT would have a line item for HWY Contracts of about $800,000,000.00 or so (just an estimate) but there will be no detail of the 70-100 contracts that would make up that amount. And there are hundreds of similiar line items for which supporting detail would fill up rows and rows of 5 drawer file cabinets.
If one were to stay on top of what you are getting for your tax money, just at the State level, I doubt you would have time for work, much less time for fishing.
I’m pretty sure what Scott is talking about is Dingell-Johnson (D-J) money and it has been around quite a while. As mentioned it was championed by anglers. It is an excise tax paid by the manufacturer. So, the consumer never sees it as they would a sales tax.
Mark’s reference is to the 1973 Conservation sales tax in Missouri, which is an across the board sales tax, not a tax on certain items, that provides 1/8 cent to Conservation programs. Those help fun the MoDept of Conservation and the activities of a few other state agencies. My uncle, as an officer in the Mo Conservation Federation, worked hard on getting that legislation passed. It made Missouri a model for agency funding, but if I recall from my post college job search as a biologist, it didn’t make their salaries much higher than other states!
Thanks for the correction, I did manage to transpose the numbers on my intro dates and your call on the salaries of MDC agents is correct, there is so much competition for employment with the MDC the salaries are barely competitive at best.
I took an Adult Ed class on fly tying 40 odd years ago. The gentleman leading the class told us to buy thread in the sewing dept so we wouldn’t pay the excise tax. Even then, I thought the tax sounded like a good thing, and still do.
The 1937 Pittman-Robertson Act that established the tax was lobbied-for by sportsmen to fund conservation. It was a significant part of the greater conservation movement driven by sportsman in the early decades of the 20th century. It’s nothing but a good thing.
The gentleman leading the class told us to buy thread in the sewing dept so we wouldn’t pay the excise tax.
Attitudes like that always amaze me.
You will constantly hear the same people complain that there aren’t enough game wardens on patrol to stop poachers, and the State doesn’t do enough to manage their fisheries well, and they ought to do more habitat restoration/improvement projects, and there ought to be better public access to popular fishing places, and on, and on, and on.
Then, when it comes time to pay for it, they buy their thread at the sewing department, because by god, they want to make sure they don’t even spend a couple extra cents to pay for it.
People want all the government services under the sun, and they complain when they don’t get it, but they want it all for free.
bd
Aside from production costs, the federal excise tax is my number one expense (although UPS is closing quickly) but I don’t mind paying it as the money goes to improve our fisheries. It is also not surprising to me that not many fishermen or fly shop owners for that matter, know about the tax. I wish that it would be more transparent.
It is also a very complicated tax. It is not really 10%. For starters, it is assumed that the tax is included in the wholesale price so it is actually 1/11th or 9.09%. If you have a distributor who is getting a 25% discount of the wholesale price, the tax is 9%. But fly shops that pay the regular wholesale price are only taxed at the same price as the distributor. This is called the constructive price.
On a $100 retail item, the wholesale price would be $60 and the distributor price might be $45. The tax on that item would work out to be $4.09 for all sales, far from the apparent 10%. If a manufacturer does not have a distributor, the tax would be based on $60 or
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