Exemption From Excise Tax for Certain Wooden Arrows
On Friday, October 3, 2008, P.L. 110-343 (H.R. 1424), the Emergency Economic Stabilization Act of 2008 (Act), also known as the Tax Extenders and Alternative Minimum Tax Relief Act of 2008, was signed into law by the President. The Act includes a key provision in Title V, Section 503 that impacts the Archery federal excise tax. The law states:
Section 503. Exemption from excise tax for certain wooden arrows designed for use by children. [(Div. C) Act sec. 503 amends Code section 4161(b)(2)] Code section 4161(b)(2)(A) imposes on the first sale by the manufacturer, producer, or importer of any shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow which after its assembly—(i) measures 18 inches overall or more in length, or (ii) measures less than 18 inches overall in length but is suitable for use with a bow described in Code section 4161(b)(1)(A), a tax equal to 39 cents per shaft. Code section 4161(b)(2)(B) contains an adjustment to the tax for inflation.
(Div. C) Act sec. 503 amends Code section 4161(b)(2) by redesignating subparagraph (B) as subparagraph (C) and by inserting after subparagraph (A) new subparagraph (B): “EXEMPTION FOR CERTAIN WOODEN ARROW SHAFTS.—Code section 4161(b)(2)(A) shall not apply to any shaft consisting of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow which after its assembly—(i) measures 5⁄16 of an inch or less in diameter, and (ii) is not suitable for use with a bow described in Code section 4161(b)(1)(A).”
(Div. C) Act sec. 503 applies to shafts first sold after the DOE.
Summary of Section 503 - Effective October 4, 2008, certain wooden arrow shafts designed for use by children are now exempt from federal excise tax and should not be included in the sales price. These are any shafts consisting of all natural wood with no laminations or artificial means of enhancing the spine of such shaft (whether sold separately or incorporated as part of a finished or unfinished product) of a type used in the manufacture of any arrow which after its assembly measures 5⁄16 of an inch or less in diameter, and is not suitable for use with a bow that has a peak draw weight of 30 pounds or more.
