Two Congressmen who are polar opposites on the political spectrum have partnered to introduce a bill to repeal the federal excise tax (FET) on heavy trucks. Reps. Doug LaMalfa (R-California) and Chris Pappas (D-New Hampshire) introduced the Modern, Clean and Safe Trucks Act of 2022 last week. Similar legislation - Senate bill S. 2435 - sponsored by Sen. Ben Cardin (D-MD) and Sen. Todd Young (R-IN) is pending in the U.S. Senate.
You may not know it, but the excise tax on heavy trucks was first enacted in 1917 to help pay for World War I! It is the highest excise tax levied by the federal government and can add more than $30,000 to the cost of new heavy trucks, trailers, semitrailer chassis and tractors for highway use, said Congressman LaMalfa. “The federal excise tax has outlived its original purpose by more than a century,” LaMalfa said. The FET was last increased to 12% in 1982 and was set to expire in 1987, yet was extended in 1987, 1991, 1998, 2005, 2012 and 2015.
The tax is paid at the time of purchase but only on new equipment. As a result, LaMalfa said, the tax discourages truckers from investing in new equipment with lower emissions and onboard safety features.
The American Truck Dealers (ATD) association saluted the bill’s introduction, noting that “…half of the Class 8 trucks on the road are over 10 years old and lack the cleaner technologies and fuel efficiency gains of today’s new trucks,” said Scott McCandless, the group’s chairman. “The FET is a barrier to our national goal to put more cleaner-emission trucks in service.”
ICSA will keep you informed on the bill’s progress.