Should outdoor rec sales be taxed?

Should outdoor rec sales get taxed?
A proposal to tax certain outdoor recreational equipment and apparel to help finance the Washington Department of Fish and Wildlife has met resistance from retailers and outdoor industry enthusiasts. Photo: freepik.com

Following significant budget cuts by the legislature following the Great Recession, the Washington State Department of Fish and Wildlife (WDFW) has yet to resume its former funding levels. As a result, the agency is looking at a variety of ways to provide long-term sustainable revenue for its operating budget. Now, one House proposal would provide WDFW a modest sum through a retail sales tax on “outdoor recreational” products.

However, critics testifying at an April 5 public hearing of the House Finance Committee say the bill would create a “regulatory nightmare” for both the state Department of Revenue and retailers as they try to determine what constitutes “outdoor recreation.”

“I think this account should be funded in some other direction,” Washington Retail Association President Mark Johnson told committee members.

Introduced by Rep. Joel Kretz (R-7), HB 2122 would impose a .20 percent sales tax on outdoor recreational equipment and apparel worth at least $200. The revenue would go into the State Wildlife Account; the use of account funds would be restricted by state law to certain purposes. The tax is projected to generate $9.8 million through 2025.

“I’m trying to address a problem that is pretty long standing here,” Kretz told colleagues at the April 5 public hearing. He argued that hunters and anglers share a disproportionate burden of supporting WDFW through fees that cover a large share of the operating budget.

As part of WDFW’s long-term funding sustainability plan, the state agency last year proposed a hunting and fishing fee increase of 15 percent. That proposal is included in HB 1708 sponsored by Rep. Brian Blake (D-19) and SB 5692 sponsored by Sen. Christine Rolfes (D-23), both introduced at the request of WDFW. However, neither bill has managed to clear the respective chambers.

“That group has been packing the freight for a long time at pretty high rates,” Kretz said. “Looking at who pays, it kind of jumped out at me that we’ve got a huge recreational industry in this state.”

According to the Outdoor Recreation Association, 72 percent of Washington residents participate in recreational activity every year. The state’s industry generates $26 billion in consumer spending annually, with $2.3 billion generated in state and local taxes.

Though Kretz acknowledged the bill is a work in progress, Johnson suggested the fundamental idea of taxing “outdoor recreational” products specifically is too difficult. “I think this (wildland) account should be funded in some other direction.”

That opinion was expressed by others at the hearing, including REI Government Affairs Director Mark Berejka. “We need to set it aside, sit down and come up with proposals that make sense, are workable and fair, and don’t punish small businesses or our outdoor innovators.”

No further action is planned for HB 2122.

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