Saturday, January 28th, 2023
Saturday, January 28th, 2023

Breaking News for

Sportsmen Since 1967

Federal Hunting and Fishing Excise Taxes Create Reported 1,000-2,000% Annual Return on Investment to Outdoor Industry

Those who know the history of wildlife conservation in America
know that hunters, anglers, and shooters pay almost all of the
freight. One large contributor to conservation support comes in the
form of federal excise taxes collected from outdoor industry
manufacturers, based on sales of fishing, hunting, and shooting
equipment and supplies.

But what has been less known is that it appears the excise taxes
benefit the makers of outdoor gear in the form of a significant
return on investment (ROI). According to a new report by Southwick
Associates and Andrew Loftus Consulting for the Association of Fish
and Wildlife Agencies, federal excise taxes collected on the sale
of hunting and shooting equipment represented an approximate 1,100
percent annual return on investment (ROI) to manufacturers between
1970 to 2006 and taxes collected on sport fishing equipment
generated a striking annual ROI of 2,157 percent between 1955 and
2006.

The ROIs in the new report “The Benefits to Business from
Hunting and Fishing Excise Taxes” were determined by comparing the
amount of excise taxes collected annually to the amount of
purchases made annually by sportsmen during the respective
timeframes. By law, the excise taxes only can be used to maintain
fish and wildlife populations, provide public access and support
programs that directly benefit hunters, shooting sports enthusiasts
and anglers.

On average, the hunting- and shooting sports-related industry paid
$251 million in excise taxes, but made $3.1 billion in revenue
through sportsmen purchases each year from 1970 to 2006. From 1955
to 2006, the sport fishing industry on average contributed $110
million in annual tax payments/import duties, but generated $2.3
billion in annual taxable equipment sales.

“How many tax models in our country today can show an $11 to $21
return to the company on every dollar spent,” said Congressional
Sportsmen’s Caucus Co-Chair U.S. Congressman Jeff Miller, R-Fla.
“This is one of the most impressive examples of how an American
industry can profit and bolster the economy while restoring and
improving our nation’s cherished natural resources.”

The excise taxes are collected quarterly from outdoor industry
manufacturers and importers for sales on items such as fishing
lures, rods and reels, firearms, ammunition and other products.
Hunting-, shooting- and fishing-related taxes are collected under
the Federal Aid in Wildlife Restoration Act and Sport Fish
Restoration Act respectively.

Funding is then apportioned to state and territorial fish and
wildlife agencies based on land area and state fishing and hunting
license sales. Agencies combine these funds with the license
revenues to conserve fish and wildlife and their habitats and
create recreational and educational opportunities. In 2009 alone,
more than $740 million was made available to states and territories
in addition to the nearly $1.4 billion total paid by hunters and
anglers in license fees.

“Outdoor activities like hunting and fishing have shaped who we are
as Americans and they are important traditions that must be
preserved. In order to do so, conservation and wildlife management
must be among our top priorities as sportsmen and women,” said
Congressional Sportsmen’s Caucus Co-Chair U.S. Congressman Mike
Ross, D-Ark. “The revenue from these excise taxes helps fund
conservation and wildlife management efforts in a fiscally
responsible way. Ultimately, the value and opportunities created by
improved habitat and more robust fish and wildlife populations
bring more sportsmen and women into the fold, which in turn spurs
more revenue and keeps the cycle of investment strong.”

“The conservation community has known for a long time that the
excise taxes provide a vital funding source for state agencies and
have enhanced fish and wildlife populations,” said Rob Southwick,
president of Southwick Associates. “This ROI study, for the first
time, demonstrates the substantial bottom line financial benefit of
these taxes back to those companies that write the checks.”

According to the ROI study, outdoor industry excise taxes have
helped to:

• Increase Atlantic striped bass populations by nearly 500 percent
since 1982; leading to a 1,000 percent increase in the number of
angler trips and generating more than $68 million on average per
year in related fishing equipment sales.

• Improve fishing in the Great Lakes from nearly nonexistent in the
1950s to world class for salmon, trout, walleye and yellow perch;
generating more than $2 billion in retail sales and supporting more
than 58,000 jobs.

• Turn Wyoming into one of the top destinations for elk hunting
with 23,000 harvested annually when in 1937 only a few hunts were
permitted.

“Everyone who has a stake in hunting or fishing-from hunters and
anglers who enjoy the resource to manufacturers who make the
products-benefits,” said Ron Regan, executive director of the
Association of Fish and Wildlife Agencies. “State fish and wildlife
agencies particularly benefit as these funds represent the single
largest, dedicated funding source for science-based conservation
programs.”

The report concludes that a decrease or elimination of outdoor
industry excise tax funding would reduce long-term investment into
the foundation of the sport-fishing and hunting-fish and game
populations, public access and recruitment of future customers.
Such a circumstance would, in turn, cause a downward spiral in
participation, which would further diminish consumer spending on
the equipment produced by manufacturers.

“The Benefits to Business from Hunting and Fishing
Excise Taxes”
report, along with full reports that include
technical details, are available for free at www.SouthwickAssociates.com/excisetaxROI.

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