January 2020 Edition | Volume 74, Issue 1
Published since 1946
Excise Tax Trends - Looking Back
Most of the excise tax related articles you have seen recently in the Outdoor News Bulletin focus on the quarterly excise tax collections that make their way into the Wildlife and Sport Fish Restoration Accounts. In these articles, we focus on comparing this year’s numbers with the numbers for the same quarter of the previous year. Some readers have asked for a more in-depth look back. The following looks at the last 13 years of collection data provided by the U.S. Fish and Wildlife Service.
Sport Fish Restoration Account Collections
Looking first at the Sport Fish Restoration Account, the collection information shows that in 2007, the total collections were roughly $695.4 million. Over the last 13 years, the collections show a slight downward trend and in 2019 the collections were $659.8 million. To simplify things a bit, the following bar and line graphs combine the eight collection categories into three. Fuel Taxes include both the small and motorboat fuel taxes. Interest on the unspent Fish Restoration Account Funds and Custom Duties (import tariffs) are combined. The final group include the more traditional fishing equipment (rods & poles, tackle boxes, general fishing equipment, and electric boat motors).
Generally speaking, the Sport Fish Restoration Account contributions have been relatively stable during this 13-year period. Although a closer look at the collections show a generally downward trend between 2007 and 2013, collections have been trending upwards since 2013. The only category with any significant fluctuation was the interest and customs duties category. Here, the fluctuation is primarily the result of interest rate changes. As always, it is important to recognize just how much of the Sport Fish Restoration Account contributions come from sources not directly related to fishing.
Wildlife Restoration Account Collections
The collections data in the Wildlife Restoration Account are anything but stable. In 2007, the collections in this account were about $324.3 million and in 2019, roughly $614.3 million was contributed into the account. During that period, the account saw contributions top $824.4 million in 2014. While the increased funding is helpful to wildlife agency administrators, the fluctuations and lack of reliability from one year to the next create significant budget management problems.
The bar and line graphs depicted here display the data in two major categories (firearms & ammunition and archery equipment). While the archery related collections represent a little less than 10 percent of the total collections of the Wildlife Restoration Account, their contributions have been much more stable. Archery equipment contributions were at $36.5 million in 2007 and closed out 2019 at roughly $48 million. That said, they have dropped off a bit since their high of just over $57 million in 2015. However, the relative stability/increases in archery are not enough to dampen the fluctuations in firearms and ammunition. While the increases have been significant, so too have the fluctuations. The 2007 number was $287.8 million and they closed out 2019 at about $566.2 million. Annual fluctuations of between $75 and $100 million are becoming the routine.
Summary
This long-term trend data suggests that we need to address our concerns over these two accounts a little differently. Over the last few years, it appears that the work of Recreational Boating and Fishing Foundation is having a positive influence on the trends. Staying focused on angler recruitment (R3) is the most important action we can take.
Things are a bit different on the wildlife side. The fluctuations in firearm and ammunition sales are not something that the conservation community can easily control. However, we can work to make sure that those who have purchased firearms (for whatever their reason) have ready opportunities to use those firearms – either in the field or on the range. Remember, an excise tax paid on a firearm is a one-time event. Excise taxes paid on ammunition for those firearms can easily eclipse those paid on the firearm. More shooting ranges should be a key component of agency recruitment strategies.
Final Thought
As we work hard to maintain a growing and reliable funding source for conservation, we must not lose sight of leakage from that funding source. The ONB has recently included articles addressing the loss of excise taxes resulting from large internet marketplace providers. More to come on that issue.