By Gary Marbut, president
Montana Shooting Sports Association
Special to TGM
In 2015, the Montana Shooting Sports Association (MSSA) proposed, and the Montana Legislature passed, the Ammunition Availability Act (AAA). The purpose of the AAA was to encourage the manufacture of smokeless propellant, small arms primers, and cartridge cases in Montana. The AAA offered three benefits to any entities taking advantage of the Act: 1) liability protection, 2) access to all existing economic development programs, and 3) significant tax breaks.
Because of contention in the Senate over special tax reductions versus general tax reductions, many of the tax benefits were amended out of the bill. Plus, a ten-year sunset was added for the tax breaks remaining in the bill. That sunset became effective on Dec. 31, 2024, whereupon the AAA tax breaks expired.
In the 2025 legislative session, HB 329 was introduced by Rep. Ed Byrne, to restore all original tax breaks to the AAA from the introduced version of 2015, and to make the AAA permanent. HB 329 was successful in retaining the significant tax breaks from the first version in 2015, but was amended to assign a new ten-year sunset for those tax breaks.
In net result, the manufacturer liability protection for any component manufacturer remains, access to all Montana economic development programs remains, and new and significant tax breaks are available for ten years, unless the Legislature should extend those further in 2035. HB 329 passed House and Senate and was signed by Governor Greg Gianforte on May 13.
Just what tax breaks are available for an entity that would start manufacture of ammo components in Montana? To start, Montana has no sales tax, so that is immediately off the table compared to most other states.
For full information see the final version of HB 329 at:
https://bills.legmt.gov/#/laws/bill/2/LC4306?open_tab=bill
Most of the tax breaks are summarized in Section 1 of the bill, and they include exemption from property taxes levied for state educational purposes, business equipment tax individual income taxes, corporate income or alternative corporate income taxes, and any other tax on business activity levied by the state. Excluded from the tax exemptions are the local portion of property tax which is not exempt and an employer’s share of employee payroll taxes that are used to finance state-mandated programs, including unemployment insurance and workers’ compensation. Also, a lender or investor lending for qualified projects is exempt from income tax for amounts loaned in arms-length transactions.
All in all, this is a pretty sweet deal for any entity setting up in Montana to manufacture powder, primers, or brass.
There are some siderails on the AAA intended to make any ammo components made in Montana under this plan available to commercial and individual Montana consumers. The underlying motive is to make Montana self-sufficient for these ammo components. To assure this, qualifying entities would need to make their products available to Montana consumers and for a price no greater than sales to out-of-state customers.
To prevent abuse, the qualifying footprint of an AAA-eligible facility could be no greater than 500 yards beyond structures used for manufacture and storage of manufactured ammo components.
In crafting this idea for the Montana Legislature, MSSA looked at the small countries in the World that make their own ammo components. Because of scale issues associated with such manufacturing, these countries usually create and operate such manufacturing with considerable state subsidies, as a matter of state security. MSSA attempted to mimic such subsidies with the benefits in the AAA.
Any person or entity wishing to explore opportunities offered by the AAA in Montana could contact MSSA, the Montana Department of Commerce, or the Governor’s Office.
