Another resolution against raising excise tax on heavy truck introduced

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The Trucker News Services  /  May 25, 2016

Sen. Cory Gardner, D-Colo., has introduced a concurrent resolution expressing the sense of Congress that the Federal excise tax on heavy-duty trucks should not be increased.

No text of the resolution was available early Wednesday, but the resolution drew immediate praise from the American Truck Dealers (ATD).

The current 12-percent FET on the sale of most new heavy-duty trucks is by percentage the highest levied tax by Congress on any product, according to Steve Parker, ATD chairman [son of legendary Hansen-era Baltimore Mack factory branch head Ed Parker].

Companion legislation to Gardner’s resolution — H.Con.Res. 33 — was introduced in the House by Reps. Reid Ribble, R-Wis., and Tim Walz, D-Minn., last year and has 30 bipartisan cosponsors.

It marked the second consecutive session that Ribble had introduced a resolution not to raise the tax on heavy trucks, but neither ever made it to committee discussion.

“The existing 12-percent FET on heavy-duty trucks, which adds nearly $20,000 to the cost of a new truck, is already a severe detriment to businesses looking to replace aging fleets with newer, safer and more fuel-efficient vehicles,” said Parker, who is also the president of Baltimore Potomac Truck Centers. “An increase in the FET would only further deter these important investments – investments that help keep our roads safer.”

Parker noted that the federal excise tax was originally imposed to help defray the cost of World War I.

Since 1955, the excise tax rate on new heavy-duty trucks, tractors and trailers has increased by 300 percent, ballooning from 3 percent to its current rate of 12 percent.

The American Trucking Associations said it supported efforts to mitigate the impacts of the federal excise tax on trucks, while recognizing the FET's importance to the Highway Trust Fund and the Trust Fund's value to the economy as a source of funding to improve the nation’s infrastructure.

“The FET is a burden on an industry that wants to purchase the newest, cleanest, safest trucks to comply with environmental efficiency and safety regulations as those technological improvements add to the cost of a new truck and increase the tax,” said Sean McNally, vice president of communications and press secretary at ATA. “We look forward to working with interested stakeholders and lawmakers to create an environment where our members are able to purchase the newest, safest, most efficient trucks without penalty, while still maintaining the integrity of the Highway Trust Fund.”

All of the heavy-duty trucks sold in the U.S. in 2015 were manufactured in North America, so any increase in the federal excise tax would depress new heavy-duty truck sales to the direct detriment of the American trucking industry and their more than 8 million U.S. employees.

Parker said the Senate and House resolutions have garnered the support of American Highway Users Alliance; American Truck Dealers; Daimler Trucks North America; Mack Trucks, Inc.; Meritor WABCO; NAFA Fleet Management Association; National Trailer Dealers Association; Navistar, NTEA – The Association for the Work Truck Industry; Owner Operator Independent Drivers Association; Recreation Vehicle Industry Association; Truck & Engine Manufacturers Association; Truck Renting and Leasing Association; Truck Trailer Manufacturers Association; and Volvo Trucks North America.