California’s 11% Firearm Tax Is Almost Entirely Passed to Consumers, Study Finds

• California implemented an 11% excise tax on firearms in July 2024, in addition to existing federal taxes.
• The tax was almost fully passed on to consumers, with firearm prices increasing by nearly the full taxed amount.
• Research found that consumer demand for firearms is largely price insensitive.
• The study used nationwide dealer price data and a differences-in-differences method to isolate the tax’s effect.
• The tax aims to generate revenue for violence prevention programs, but its effectiveness as gun control is uncertain.

Source: bfi.uchicago.edu

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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