Rep. Doug LaMalfa (R-Calif.) recently reminded the House Transportation and Infrastructure Committee about his legislation designed to repeal the long-standing 12% federal excise trucking tax.
LaMalfa explained his legislation would specifically “look at a way to relieve the burden on people that would buy new trucks.”
“There is a federal excise tax specific to them of 12% on a new vehicle — 12%. Now, we want to promote newer, cleaner-burning and safer, better trucks to be on our highways, and so the disincentive for that is to hit them for a 12% tax on the purchase of that new vehicle,” said LaMalfa during a committee hearing Oct. 18 that examined the status of the federal Highway Trust Fund.
He added, “And as we note with the other forms of taxation — the Highway Trust Fund — there’s a user-pay, user-benefit aspect to all the other different forms of it, and this one here is not a user-pay, user-benefit because it’s indeed hidden every time you buy one of those new vehicles, if you choose to do so.” The trust fund is backed by revenue from the fuel tax.
LaMalfa and fellow co-sponsors point to the excise tax’s potential for adding $15,000 to $30,000 to the cost of new heavy trucks.
“Not only will repealing this federal excise tax deliver upfront cost savings for truckers and small businesses, but it will also provide downstream supply chain and cost-saving benefits for consumers,” Rep. Chris Pappas (D-N.H.), a co-sponsor said recently.
“This legislation will also support the adoption of newer, safer and cleaner trucks that lower greenhouse gas emissions and reduce our dependence on foreign energy.” A committee of jurisdiction in the House has yet to schedule a vote on the legislation.
Sens. Ben Cardin (D-Md.) and Todd Young (R-Ind.) are co-sponsors for companion legislation on the Senate side of Congress.
“It’s time to repeal this outdated and onerous tax on our Hoosier truckers,” Young said. “Our legislation will spur growth and competitiveness while making our roads safer and less polluted,” Cardin added.
American Trucking Associations with the Clean Freight Coalition continues to call on members of Congress to repeal the tax.
ATA President Chris Spear took aim at the tax during the federation’s conference this month. “If the goal is to reduce emissions, eliminate the century-old federal excise tax,” Spear told freight executives at ATA’s 2023 Management Conference & Exhibition in Austin, Texas.
ATA Chairman Andrew Boyle, co-president of Massachusetts-based Boyle Transportation, raised the point during a Senate hearing: “Eliminating the [federal excise tax] will reduce the cost of new technologies by tens of thousands of dollars and is a technology-neutral solution that allows companies to invest in not only battery-electric, but alternative fuel vehicles as well depending on the availability of infrastructure to support the specific technologies.”
