Truckers not paying their 'fair share'?

By Mike Matousek, OOIDA director of state legislative affairs

Do truckers pay their “fair share” toward investing in our nation’s transportation infrastructure? Here at OOIDA we strongly believe the answer is yes, but there are many legislators and legislative bodies across the country that would disagree.

As you probably know, small-business truckers are subject to a number of taxes: Heavy Vehicle Use Tax, International Fuel Tax Agreement, Unified Carrier Registration, 12 percent federal excise tax on the purchase of new tractors and trailers, International Registration Plan, and a federal excise tax on the purchase of new tires, just to name a few. Of course the majority of taxes that commercial trucks pay – including those listed above – do not apply to personal automobiles.

Apparently, truckers should still pay more.

Recently, the Finance, Revenue and Bonding Committee of the Connecticut General Assembly reportedly considered eliminating an existing sales tax exemption for commercial trucks and/or trailers that are purchased in the state. The sales tax exemption is perhaps the largest (and only) economic incentive for owner-operators to purchase new equipment not only in Connecticut, but in many other states.

OOIDA communicated with elected officials in Connecticut to briefly highlight a few reasons why repealing the exemption is bad for truckers, truck and part manufacturers, truck retailers, and many other trucking-related businesses. Ultimately, the sales tax exemption was not repealed, but the fact that it was even considered is alarming. We can only surmise that either the legislature believes truckers do not pay their fair share or they are simply trying to find additional revenue for state coffers, or both.

Earlier this year in Missouri, state Sen. Doug Libla introduced a measure to increase the motor fuel tax (for both gas and diesel) from 17 cents per gallon to 23 cents, which would be phased in over a period of three years.

OOIDA initially supported this initiative. It was an equitable proposal using a known and efficient method of collecting transportation revenue. And according to the Missouri Department of Transportation, without new revenue the state would risk losing out on federal transportation funds as early as 2017 because it will be unable to comply with state matching requirements.

OOIDA would like to commend Sen. Libla for his leadership. Unfortunately, a few of his colleagues, including Sen. Rob Schaaf, used a filibuster on the Senate floor to demand that changes be made to the bill. Schaaf spoke about truckers not paying their fair share when he offered a change to increase the gas tax rate by 1.5 cents and the diesel rate by 3.5 cents.

Another change would give Missouri authority to toll I-70, as well as other roadways within the state. Essentially, the Missouri General Assembly started with a proposal that was fair, efficient, and supported by numerous stakeholders. As amended, they now have a proposal that would impose significant new taxes on truckers. Why? Your guess is as good as ours.

Connecticut and Missouri are certainly not the only states that view trucks as rolling ATMs. OOIDA will continue to work to change this perception by educating lawmakers about the trucking industry and remind them that their actions have significant consequences on small-business truckers. LL