[Ansteorra-archery] The arrow tax
eadric at scabrewer.com
Tue Oct 7 12:16:06 PDT 2008
I just realized I have a typo.
/For instance "arrows" were taxable. Many shafts, fletches, nocks,
and target style points were not (hunting broadheads were not). /
What I meant to type was:
For instance "arrows" were taxable. Many shafts, fletches, nocks,
and target style points were not (hunting broadheads _*were taxed*_).
Doug Copley wrote:
> Wow,I was not aware of any of this!! Thanx for the information and the
> background on it.
> Eadric Anstapa wrote:
>> The federal excise tax on archery equipment has been around for
>> decades and I never had a problem with it. It was not just for
>> archery equipment but also various other firearms and hunting and
>> fishing equipment. The tax was traditionally 12.4%. I have never
>> had a problem with it because the funds raised from this tax were
>> relegated specifically to wildlife conservation an education efforts
>> and therefore sportfishing and hunting type items is what was taxed.
>> For instance any bow over 30# had to be taxed. Any bow under 30
>> pounds and any arrow under 18 inches did not have to be taxed (unless
>> the short arrows were intended for use in a taxable bow i.e. crossbow
>> bolts) (the tax for bows is 11%)
>> If you manufacture and sell bows or crossbows then you have to
>> collect and submit the tax else you are guilty of federal tax
>> evasion. The statutes defined "manufacturer" to include any person
>> who produces a taxable article from scrap, salvage, or junk material,
>> or from new or raw material, by processing, manipulating, or changing
>> the form of an article or by combining or assembling two or more
>> articles. The term also includes a "producer" and an "importer'.
>> The problem was that there were a lot of people doing lots of hinky
>> things to get around collecting the excise tax.
>> For instance "arrows" were taxable. Many shafts, fletches, nocks,
>> and target style points were not (hunting broadheads were not). So
>> what was happening is that people would sell incomplete arrows and
>> therefore they would avoid the tax.
>> Every wonder why if you ordered a set of arrows from some place like
>> Red Feather, F/S or other supplier they would ship finished shafts,
>> with nocks and fletches installed, shafts cut to your specified
>> length and with point tapers on them, but the points would not be
>> installed but only included in the box? That was so they could say
>> that they had not sold completed "arrows" and therefore would avoid
>> the federal excise tax.
>> Ever see a bow marked as 30xx# rather than 30#? That was partially
>> so they could sell it as a 30# bow (untaxed) even it it actually drew
>> over 30#. The same would be true for any bow that was marked as 30-35#.
>> Arrows spined 30-35# people would often avoid the tax by simply
>> saying that they were not necessarily intended for bows over 30#.
>> They then starting taxing all arrow components such as nocks, points,
>> shafts, etc. at 12.4% if they were suitable to be shot from a taxable
>> bow. But there were people who had creative ways to get around
>> that. the would play with the "suitable to be shot from a taxable
>> bow" part of it.
>> So to get people to pat the tax back in 04 to get people to collect
>> the tax for arrows they changed it to a per shaft tax. They started
>> off at 39 cents and then crept up. At the time a typical good set of
>> wooden shafts cost about $2 a shaft. So the that was a pretty high
>> tax equal to about a 20% tax on traditional archers using wooden
>> shafts. But a high tech modern carbon fiber shaft might sell for $10
>> a shaft so a 4% tax was hardly noticed and even a typical good
>> quality name brand aluminum shaft cost about $5 a shaft so a 8% tax
>> didn't seem onerous. remember these costs are collected by the
>> manufacturer, they are an excise tax and not a sales tax, and since
>> they are a fixed cost they are built into the cost out of the factory
>> and most archers and hunters were and still are not even aware that
>> the excise tax was even there.
>> To be sure the 39 cents per arrow shaft that crept up to 43 cents
>> unfairly burdened the traditional archer While the modern compound
>> bow shooter using Easton GameGetter shafts, or Gold Tip or Carbon
>> Tech hunter shafts hardly noticed the increase.
>> Once they started taxing the shafts they dropped the tax on
>> individual components like fletches, nocks, and points. So while
>> your shafts may have had a 43 cent tax on them, you effectively
>> should have seen a 12.4% reduction in price on points, nocks,
>> fletches, etc. But I never saw any reduction in price on those
>> components and those manufacturers just seem to pocket that extra 12.4%.
>> So the low end domestic manufacturers of wooden shafts for children
>> complain that they are driven out of business and that their sales
>> have dropped sharply. While they did did carry an unnecessarily high
>> portion of the tax burden ins the part of the equation here that is
>> not considered is that the availability of inexpensive imported
>> composite shafts for the low-end and children's market has
>> increased. A big part of the reason why the sale of wooden
>> children's arrows has decreased so dramatically is that the more
>> people are instead buying fiberglass and carbon for the kids since
>> those shafts stay straight and last forever in typical use.
>> Don't get me wrong. I am happy the tax has been modified so that it
>> is no so regressive, doesn't place as much of a burden on the low
>> end, and doesn't place more of the burden on the traditional archer.
>> the latest revision of that tax code was flawed and they are trying
>> to correct that but in general I support the tax because those monies
>> were earmarked to go do things rather than simply going into the
>> general fund for congress to waste as they see fit.
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