ATA's Spear lays out timeline to tackle FET

Updated Jul 2, 2024
The U.S. Capitol Building
ATA President and CEO Chris Spear sees an opportunity to launch another effort to repeal the federal excise tax in 2025.
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Chris Spear, president and CEO of the American Trucking Associations, has long championed repealing the federal excise tax (FET) on trucks and other heavy-duty equipment.

“I’d also pull the FET, the federal excise tax that’s brought to every new tractor and trailer purchased today,” he told Truck, Parts, Service sister publication Commercial Carrier Journal in an interview Wednesday. “That’s 12%. That is the operator’s money. Whether you’re an owner-operator, a fleet; that’s your money. It shouldn’t belong to the government.”

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The federal government started collecting the federal excise tax on commercial vehicles in 1917, when there were fewer than 400,000 trucks registered in the country. It was a way to help pay for World War I. There are now more than 14 million commercial trucks on the road and they’re vastly more complex — and more expensive — than the trucks from the early 20th century. While the FET no longer pays for world wars, it does pay for roads. In 2023, it raised around $5 billion for the Federal Highway Trust Fund.

ATA and other organizations perennially fight the FET. The latest effort, in 2023, failed to make it out of committee but Spear sees another opportunity to pick up the fight.

“There’s a chance after the election, in a lame duck environment, we might have a tax extenders package done that could serve as a vehicle (a bill to include an FET repeal),” he says. “I think the greater chance of this happening is probably in 2025 when the Trump tax bill extenders begin to expire. That will be a vehicle I could see FET being attached to.”

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Spear and the ATA argue the 12% tax prevents some fleets from upgrading their trucks to cleaner, more efficient diesel engines, never mind the more expensive alternative powertrains.

“You can invest into newer equipment,” he argues. “You can invest it into pay, you can invest it in training, and safety technology. But that’s a decision that should come to the operator that will allow us to get newer equipment out on the road and replace the 2010 or older (equipment) operating in the U.S. You remove that, you’re going to reduce emissions dramatically.”

The ATA argues trucks manufactured with the latest diesel technology — those made after 2010 — run cleaner than older trucks.

“We’ve reduced emissions by 98.5% over the last four decades,” he says. “Sixty trucks today produce what one truck emitted in 1988.”

Spears sees 2025 as an opportunity no matter who is in the White House or what party they represent, but there are some other factors to consider in a possible FET repeal. Spear says it must be a bipartisan effort, which he says the industry has, along with champions on the appropriate committees in both chambers.

“That’s a very big distinction from previous efforts,” he says. “I’m encouraged because that’s where the legislation will be introduced. That’s where it gets written, amended and passed onto the floor. You don’t want to be dealing with this on the floor. It’s too late.”

Both a Biden or a Trump administration could possibly sign off on a FET repeal, Spear says.

“In my view, this is a win-win across the board,” he says. “We hope this is on the front burner for passage.” 

Jason Cannon has written about trucking and transportation for more than a decade and serves as Chief Editor of Commercial Carrier Journal. A Class A CDL holder, Jason is a graduate of the Porsche Sport Driving School, an honorary Duckmaster at The Peabody in Memphis, Tennessee, and a purple belt in Brazilian jiu jitsu. Reach him at [email protected]
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