Who Pays for California’s Gun Tax?
How the state’s 11 percent levy affected prices.
- By
- May 11, 2026
- CBR - Fiscal Policy
When California legislators imposed the first-ever state-level firearms tax in 2024, they framed it as an action taken to reduce gun violence by making it more expensive and less appealing for consumers to buy guns.
Research suggests that the 11 percent tax has indeed raised prices for consumers. In its first nine months, it lifted gun prices in California by nearly as much as the tax itself, according to Chicago Booth PhD student Sara Drango, University of California at Berkeley’s Sarah Moshary, and Booth’s Bradley Shapiro.
The levy is on top of the state sales and federal excise taxes that firearms are already subject to. When it was passed, it wasn’t clear whether gun sellers in California would drop prices to retain sales. After all, buyers have options, which include crossing state lines to buy a cheaper firearm.
The researchers analyzed pricing of 48 popular firearms at nearly 2,300 federally licensed sellers in all 50 states. Their data covered January 2024–March 2025, before and after the tax took effect in July 2024.
From policy to price tag
When California implemented an 11 percent excise tax on firearms, prices rose about 10 percent while prices in other states barely changed—indicating the tax was almost entirely passed on to buyers.
They find that firearm prices increased by about 10 percent in response to the tax. California was the only state with a material price change on guns during this time, while gun prices in other states rose by less than 1 percent, on average.
Businesses did not absorb the tax by lowering prices, the research suggests. The average price of a firearm sold in California was about $990, versus an average closer to $930 in the rest of the country. And there was no evidence in the data suggesting that Californians left the state to avoid the tax. Rather, it seems that they paid it—and did so for all types of guns.
Tobacco, alcohol, gambling, and sugary drinks are all commonly subject to excise taxes. These “sin taxes” are often intended to curb consumption of a product or service while generating revenue. Economic theory suggests that a 10 percent increase in prices such as the researchers observed should reduce sales by about the same amount, but it’s not yet known if California’s gun tax has had this effect. Drango, Moshary, and Shapiro say more research is needed to look at total gun sales.
In the meantime, states considering firearms taxes of their own could look to the research for clues about how their policies may play out. Colorado passed a 6.5 percent firearms and ammunition excise tax, which went into effect last year. Maryland legislators are considering an 11 percent tax.
Sara Drango, Sarah Moshary, and Bradley Shapiro, “California’s Firearm Excise Tax Is Almost Fully Passed On to Consumers,” Working paper, December 2025.
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