PHOENIX — Arizona lawmakers are moving to help make the purchase of guns just a bit more affordable.
By a 6-4 margin, the House Ways and Means Committee voted Wednesday to exempt the sale of firearms from the state’s 5.6% sales tax. HB 2166 also would impose the same preclusion on cities.
“It’s my view that firearms should not be out of reach of anyone based on income,” Rep. Steve Kaiser, R-Phoenix, told colleagues. “It should be as affordable as possible.”
The bill now requires a vote of the full House.
Also exempt from taxes would be the sale of safety accessories, ranging from gun safes or cases to certain interlocks to prevent a weapon from being fired unless first deactivated by someone who is supposed to have access.
Individual affordability aside, Kaiser said what his bill also would do is end the financial disadvantage of firearms dealers.
"As you know, we have the private sale option in Arizona, which means you can go to a gun show, for example, and buy a private weapon from a private citizen,” he said. “That’s something I will always protect.”
But that private seller, Kaiser said, is not required to charge state or local sales taxes. All totaled, he said, those levies can add up to 10% or more to the out-the-door price.
“This would actually encourage more folks to go to gun stores,” he said. “They can support our local businesses that sell firearms and firearms safety equipment.”
But the claim that the exemption is justified by the ability to make tax-free person-to-person sales did not wash with Rep. Amish Shah, D-Phoenix.
“If I wanted to buy a TV out there, I could go to Best Buy,” he said. “Or I could just buy it from a guy on the street.”
And, in the latter case he would not have to pay the sales tax.
More to the point, said Shah, in both cases the issue is the purchase of a used piece of equipment. So why, he asked Kaiser, should the sale of a new gun be exempt from sales taxes while that is not the case if he buys a new TV?
Kaiser, however, said there is a difference.
“Firearms store their value very well as far as the price point,” he said.
“And, so, a used gun is very similar, almost identical in price, sometimes more expensive,” Kaiser continued. Plus, he said, certain new guns are so popular, they fly off the shelves.
“So used guns are sometimes more expensive than retail guns of the same make and model,” he said.
Dave Kopp who lobbies for the Arizona Citizens Defense League said there is precedent for the exclusion. He said existing law already exempts many health and safety items from sales taxes.
“Guns certainly fall into that category,” Kopp testified.
And he noted that when Gov. Doug Ducey, in closing certain retailers in 2020 at the beginning of the COVID pandemic, exempted what he called “essential businesses.” And the governor specifically included in that list “firearm and ammunition suppliers and retailers for the purpose of safety and security.”
“Guns save lives,” Kopp said. “Guns stop crime. Guns are what keeps America free.”'
Kaiser told Democrats that they should support what he is trying to do. And it comes back to that ability to buy weapons at gun shows.
He noted that, under state and federal law, those purchases are considered private sales. More to the point, the sellers are not required to conduct the same background checks on buyers as are licensed firearms dealers.
Democrats for years have been trying to enact bills to close what they call the “gun-show loophole,” all without success in the Republican-controlled legislature. Kaiser said this gets them a bit of what they want.
“It would be more like a free-market approach to getting more background checks from your perspective,” he said.
But committee Democrats were unconvinced.
“I don’t see guns as essential to life,” said Rep. Pamela Powers Hannley, D-Tucson. “And I completely disagree with the idea that more guns will save lives.”
And then there was the financial aspect.
Legislative budget staffers figured that the exemption when fully implemented would cut state revenues by $5.8 million from the sales of weapons themselves and another $570,000 from not taxing accessories.
That doesn't count losses to local governments who get not only a share of state sales taxes but have their own levies.
Rep. Mitzi Epstein, D-Tempe, said she believes that the best form of taxes is one applied to as many items as possible “so we can have a lower rate.” This, she said, goes in the opposite direction.
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