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Is It Feasible To Add An Excise Tax On Recreational Equipment In The Colorado State?

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Executive Summary

Right now, Colorado state agencies are having a hard time keeping up with all the conservation issues our state faces today. The reason behind this isn’t because they aren’t good at their job, it is due to finical problems. Most of Colorado’s state conservation funds come directly from hunting and fishing licenses. Since there has been a large decline in both hunting and fishing over the last decade or so, the state agency has had a hard time trying to accomplish all the goals and projects needed to keep our state conservation up to par. This has been a rising issue our state faces today. Yes, there has been a lot of public outreach programs to inform Colorado residents that hunting and fishing is the key source to conservation funds that take care of our state but that just isn’t enough because not everyone enjoys hunting and fishing.

A solution to this problem is to add an excise tax on all outdoor, recreational equipment in the state of Colorado. That would be to add a 10% tax on all recreational equipment purchased in Colorado. All the money accrued from this excise tax would be split up evenly between Colorado state agencies that have a roll in the conservation efforts of the state. This is needed for the sake of our states environmental health, to keep jobs for people in the natural resource field, and for save habitats as well as ecosystems for all abiotic and biotic organisms living in our state.

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There is plenty of evidence on why this is needed. There are a lot of environmental concerns in our state that many may not know about, which is why agencies like the Colorado Department of Agriculture and Colorado Department of Natural Resources needs more funding. Some of these issues include bee population decline, drilling in our state forest, and many, many more (Environment Colorado, 2018). There are so many issues like these that people do not know about, which is why our state needs to add an excise tax on recreational equipment for conservation efforts.

Introduction

The Problem

Hunting has declined drastically over the last decade, which is the leading cause of the financial hardship all these conservation driven agencies face. According to U.S. Fish and Wildlife Service, “only about 5 percent of Americans, 16 years old and older, actually hunt. That’s half of what it was 50 years ago, and the decline is expected to accelerate over the next decade”. This creates a need for an excise tax to provide enough funding to fix the conservation problems we face today. For example, Colorado Parks and Wildlife 2018 total funding is 218.7 million dollars, while 56% of that comes from licenses, passes, fees and permits (CPW, 2018).

The Plan

With the decline in license sales to Colorado hunters and fishers, we need to implement a new excise tax to increase our state conservation funding to keep our trails wilderness and wildlife health. You can see how much it really has declined in figure 2, about 3 % since 1991.

An excise taxes are taxes paid when purchases are made on a specific good (IRS, 2018). In this case, it would be a 10% excise tax that would be placed on all outdoor recreational equipment. A few examples of recreational equipment are tents, sleeping bags, rock climbing gear, camping stoves, and things of that nature. An excise tax like this already exists, the Federal Aid in Wildlife Restoration Act, also known as the Pittman-Robertson Act. The Pittman-Robertson Act was implemented in 1937 and it is an excise tax set at 11% on all sporting arms and ammunition. These funds are split up appropriately between different states to improve habitats, hunter education programs, and research into wildlife problems (Fish and Wildlife Service, 2016). This plan is meant for the state of Colorado unlike the Pittman-Robertson Act, which is regulated on a federal level. There are other examples of excise taxes for the collective good of the environment such as the Dingell-Johnson Act and the Wallop-Breaux Act. If this has worked for the federal government, why couldn’t it work for Colorado? Colorado Parks and Wildlife has already proposed this idea of adding an excise tax on equipment because they see the trend of license sales declining. They have been asking the public how they feel about it to see how to make it feasible for every stakeholder involved.

The Feasibility

Analysis

When analyzing the proposition of adding a 10% excise tax to outdoor equipment in Colorado, it is easy to compare it to the Pittman-Robertson Act. The idea behind this plan is a “user pay, public benefits” structure. This means that the people who buy outdoor equipment are the only ones paying the tax on the gear. Addition to that, these same outdoor enthusiasts would be more than happy to pay an extra tax on their gear to keep where they recreate full of biodiversity and healthy. Sportsmen and women believe it is only fair for everyone else that is recreating outdoors to pay their fair share to the conservation bill. The reason they are saying this is because the excise tax they are paying for their weapons and ammo, Pittman-Robertson Act, goes straight to conservation funds, while others like birders or hikers aren’t paying a tax, yet still utilize nature (Outdoor Industry, Boian, 2016). This idea is of thinking is called “pay to play”. By examining how this has worked with the Pittman-Robertson Act, and looking at data on how stakeholders feel about this issue shows that the “user pay, public benefit” needs to happen before Colorado must choose between laying off workers and leaving conservation issue untouched. According to National Public Radio, “Colorado’s wildlife agency has cut tens of millions of dollars in expenditures and trimmed programs that deal with invasive species”. The analysis shows that right now, habitats are being lost, sportsmen and women are paying the conservation bill, and people are losing their jobs, all due to a decline in license sales.

Feasibility

There are many reasons that make this plan feasible and they all have a direct correlation to the financial hardship Colorado conservation agencies face today. It all stems from the huge decline in fishing and hunting licenses because that is the key source of income for our state’s conservation efforts. Since the license sales are down then the agencies have no funds to conserve our wilderness and parks. Also, with no funds, they must either cut down on conservation projects or lay off workers. It is basically a trickle-down effect that can lead to the devastation of our states ecosystems, biodiversity, and wear and tear on our parks and trails. This is all the criteria needed to show the need to add this 10% excise tax on outdoor gear and equipment.

By adding an excise tax on all recreational gear, it can help boost the Colorado economy with a little more spending on goods and products. It will also create more jobs in the natural resource career field while still restoring the jobs that wear already lost by the lack of funds. With this excise tax put in place, it will encourage people to develop into the best person they can be while feeling better about themselves for helping the environment. People that support the tax will have a sense of accomplishment knowing that they did their part to help our state and the natural areas around them.

Conclusion and Recommendations

CONCLUSION

After all the data, facts, and research it would be a very smart and a feasible decision to add a 10% excise tax to recreational equipment in the state of Colorado to improve the funding that the agencies are lacking. This plan is feasible because it is a win, win situation for everyone involved. The state agencies would be happy to have more funding. The people utilizing the parks and trails will be more than willing to pay a tax on their gear to keep our great state of Colorado environmentally and conservational friendly. The species and organisms will have better ecosystems to live in while keeping plants and trees happy as well. Overall this plan would work very well and produce the missing income that the agencies use to have before the license sales drastically declined. There is proof that it will work due to the sole fact that the Pittman-Robertson Act has been working on the federal level since 1938.

Recommendations

The public needs to know more about the ecological and environmental challenges that our state faces. It would be ideal to have free weekly public awareness brochures that are made available to the public, so they know where these excise taxes are going and how they help with the conservation in Colorado. Next, the public needs to be more informed about how licenses help provides income for Colorado Parks and Wildlife to help keep our state in tip-top shape in terms of conservation and ecology. A lot of people don’t realize that is where most of the funding comes from.

The best recommendation would be exactly what this feasibility report is about, to add an excise tax on outdoor recreational equipment to make up for the lack of license sales. Mankind needs to think more of being one with that land rather than thinking of it as a piece of property. We need to cherish what has been here long before humans. As the godfather of conservation, Aldo Leopold once said, “Conservation is a state of harmony between man and land”. That quote sums up why Colorado needs and excise tax.

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