Washington State Legal Showdown Awaits Tax Proposal for Guns and Ammo

A nickel a bullet and $25 dollars per gun. That’s how much businesses selling ammunition and firearms in Seattle would have to pay in new taxes under a legislative proposal that emerged in the City Council there on Wednesday.

Council President Tim Burgess unveiled the legislation in tandem with another bill that would require people to report lost or stolen firearms to the Seattle Police Department within 24 hours of the time they are discovered missing. Failure to do so would result in a penalty of up to $500.

The city’s budget office estimates that the tax measure could produce between $300,000 and $500,000 annually. The money generated from the new taxes would go toward gun violence research and prevention programs.

“We're taking this action to address the epidemic of gun violence and the cost that it imposes on Seattle taxpayers, and I think it’s very reasonable that the gun industry help defray that,” Burgess said during an interview on Wednesday.

But a gun rights group based near Seattle is already threatening to mount a legal challenge against both bills if they are enacted, arguing that they run afoul of state law.

A situation like this is already taking place in Cook County, Illinois, home to the city of Chicago and many of its suburbs.

A firearm tax similar to the one Burgess has proposed went into effect there in 2013. It prompted gun shops and citizens to file a lawsuit that continues to unfold.

According to a fact sheet Burgess’ office distributed with the bills, the direct cost of treating 253 gunshot wound victims at Seattle’s Harborview Medical Center last year was over $17 million, and taxpayers covered more than $12 million of that total.

Zach Silk, a strategic adviser for the Washington Alliance for Gun Responsibility, applauded Burgess for putting forward both pieces of legislation. “We obviously tax cigarettes, we tax alcohol,” he said. “As a society we recognize that products have harms associated with them.”

“We know that guns are a product that do cause harm,” Silk added.

Burgess said the bill with the lost and stolen firearm reporting requirements would help “the police trace guns used in crimes, it will help the police return guns to their rightful owners, perhaps most importantly it will prevent gun owners from being falsely implicated in crimes.”

The group threatening to sue the city over the two pieces of legislation is the Second Amendment Foundation, a gun rights organization based in Bellevue, Washington, just east of Seattle. “We've already sued the city of Seattle in the past,” said Alan Gottlieb, the group’s executive vice president. “We'll just do it again,” he added. “They make it easy for us.”

Gottlieb pointed out that Washington has what’s known as a “preemption” statute, which says state regulations preempt local ones when it comes to the “registration, licensing, possession, purchase, sale, acquisition, transfer, discharge and transportation” of guns and ammunition.

The statute also says that “local laws and ordinances that are inconsistent with, more restrictive than, or exceed the requirements of state law shall not be enacted.”

The Second Amendment Foundation prevailed in a previous legal fight with Seattle that centered on this statute.

A state Court of Appeals sided with the group in 2011, affirming a lower court ruling that said a city ban on guns near spaces such as parks and community centers violated the preemption law. The state Supreme Court later declined the city’s request to review the case.

“There's no way we're going to tolerate this, or let it stand,” Gottlieb said of the new bills. “It's very much settled case law that cities, towns, counties, political subdivisions, in the state of Washington, can't pass anything to do with firearms.”

Burgess said the city is anticipating a lawsuit. “We clearly cannot regulate firearms,” he acknowledged. But in his view, “neither of these measures do that.”

Seattle City Attorney Pete Holmes agrees, according to a spokeswoman for his office, Kimberly Mills. “We believe that we are on sound legal ground with these bills,” she said in an email on Wednesday. “The City has broad taxing authority from the Legislature,” Mills added. “This is purely a revenue measure and does not regulate the possession or use of firearms.”

Burgess specified that his proposal does not call for a sales tax. Instead it relies on the city’s business and occupation taxing authority, which allows businesses to be taxed on the volume of the goods they sell.

As of June 2015, there were 22 individuals or businesses licensed to sell firearms in the city of Seattle, according to the fact sheet detailing the legislation.

One of these businesses is Precise Shooter, LLC., which is located along Aurora Avenue North, near Seattle’s Green Lake. Owner Sergey Solyanik said that if the tax measure is enacted, he’ll most likely move the store out of the city. “We will simply close,” he said.

While he has a range of customers, Solyanik said he tends to cater to competitive target shooters, and that police have never traced a gun involved in a crime back to his shop.

“The background checks, and the firearm tracing data,” he said, “just does not support the theory that our firearms are used to kill people.”

He also questioned the revenue projections in the tax bill. “It’s just not a big market,” Solyanik said. “I don’t know how they’re imagining that $25 per firearm could possibly generate this much money.” He added: “We sold less than 2,000 firearms in six months.”

But, he sees that as somewhat of a moot point, because he believes that if the tax goes into effect, people will go outside of Seattle to buy their firearms and bullets, while businesses will move along with them or stop selling guns. “There will be no revenue stream,” he said.

The taxes are not insignificant compared to the cost of the goods Precise Shooters sells, he noted. Some of the shop’s most popular types of ammunition cost 5 cents a round, Solyanik said, a price equal to the proposed tax, while an average firearm costs $400 to $500.

Asked if he thought there would still be enough firearm sales taking place in the city to fund gun violence prevention programs and research if the tax were put in place, Burgess said: “We don’t know for sure.” But the revenue is not the only reason he see’s the tax bill as important.

“Municipal governments are the incubators of change,” he said, “and, if by enacting this in Seattle, we could persuade the state of Washington to impose this kind of a tax, then that would be great progress, too.”

Cook County’s tax on the retail purchase of firearms went into effect in April 2013. The county has continued to collect it even as the legal battle involving the gun shop owners grinds on.

“While the suit is not settled, we have no indication that we’re going to need to revoke the tax at this point,” the county’s deputy director of revenue, Ken Harris, said on Wednesday.

There are currently 32 firearm retailers registered with the Cook County Department of Revenue and, last year, the tax produced $889,344, according to Harris.

The plaintiffs in the court case, who are opposed to the county tax ordinance, have argued that it’s unconstitutional, and also that it is unenforceable because it is preempted by state law.

“There were two groups of plaintiffs, the gun dealers and then the citizens, the individuals who want to buy the guns,” Steve Campbell, a spokesman for the Cook County State's Attorney's Office, said on Wednesday as he provided a brief summary of the current status of the case. “The judge has thrown out the gun dealers portion of the lawsuit and they’re appealing it.”

The case is currently before a Cook County Circuit Court, and a successful appeal by the gun shop owners would take it to the Illinois Supreme Court. The next hearing is set for Aug. 18.

Does Burgess think that it’s worth getting the city of Seattle into a similar legal conflict over a tax that could yield just a few hundred thousand dollars each year? He does.

“It’s worth it because the harm being inflicted is so costly and so significant,” he said. “The scope and scale of gun violence in our country is way, way out of proportion to any other Western, industrialized nation. It’s shockingly out of proportion.”

Burgess added: “Why wouldn’t we want to take steps to try to alleviate that?”