American Truck Dealers (ATD) Chairman Steve Parker praised U.S. Rep. Doug LaMalfa’s (R-Calif.) decision Tuesday to introduce of H.R. 2946, a bill that would repeal the harmful and outdated federal excise tax (FET) on the retail sale of most heavy-duty trucks, tractors and trailers.
“The 12-percent federal excise tax on heavy-duty trucks is the highest percentage rate of any federal excise tax that Congress levies, and it adds $12,000 to $22,000 to the price of a new heavy-duty truck,” says Parker. “The FET depresses new heavy-duty truck sales and delays the deployment of cleaner, safer and more fuel-efficient trucks.”
Rep. LaMalfa’s bill, “Heavy Truck, Tractor and Trailer Retail Federal Excise Tax Repeal Act of 2017,” also is supported by ATD. ATD is hosting its annual legislative fly-in to Washington, D.C., on June 21 and 22 to rally congressional support for the legislation. ATD represents more than 1,800 U.S. commercial truck dealers.
“The excessive 12-percent federal excise tax on heavy trucks adds tens of thousands of dollars to truck purchases and directly impacts the cost of food, consumer goods and other products Americans need. Even worse, truck owners large and small pay this tax whether a truck is driven 100,000 miles or never driven at all, forcing them to pay taxes on an investment that may not be generating any revenue,” Rep. LaMalfa says. “Repealing the truck tax will help small businesses invest in new equipment while jump-starting domestic manufacturing, and Congress should address this issue as we consider how to reform our outdated tax code.”
The FET was originally imposed in 1917 to help defray the cost of World War I. The tax has grown from 3 percent, when it was incorporated into the Highway Trust Fund in 1955, to 12 percent today.
“This outdated tax also is essentially a tax on American jobs. It’s time for Congress to take a hard look at the FET and determine if this tax has outlived its usefulness,” says Parker, president of Baltimore Potomac Truck Centers in Linthicum, Md., which operates five full-service commercial truck dealership locations with Mack, Volvo and Hino Trucks franchises in Maryland and Virginia. “The FET hurts truck sales and inhibits job growth, directly affecting the 7.3 million Americans employed in the U.S. trucking industry.”
H.R. 2946 now heads to the House Ways and Means Committee.
“Congress should include H.R. 2946 in the upcoming tax reform bill. A repeal of the FET will spur new-truck sales and get our economy moving,” Parker says. “We commend Congressman LaMalfa for his leadership on this important issue.”