U.S. Representative Doug LaMalfa (R-CA) introduced a bill this week that seeks to eliminate the 12% federal excise tax or “FET” most heavy-duty trucks, tractors and commercial trailers – a levy the American Truck Dealers (ATD) group claims can add anywhere from $12,000 to $22,000 to the sticker prices for such equipment.
“The excessive 12% FET 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,” Rep. LaMalfa noted in a statement.
“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,” he stressed.
“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while jump-starting domestic manufacturing and Congress should address this issue as we consider how to reform our outdated tax code,” Rep. LaMalfa added.
“The 12% FET on heavy-duty trucks is the highest percentage rate of any federal excise tax that Congress levies,” noted ATD’s Chairman Steve Parker in a statement. “The FET depresses new heavy-duty truck sales and delays the deployment of cleaner, safer and more fuel-efficient trucks.”
Rep. LaMalfa’s bill – H.R. 2946 and dubbed the Heavy Truck, Tractor and Trailer Retail Federal Excise Tax Repeal Act of 2017 – follows a similar effort to eliminate the FET attempted five years ago.
ATD noted that the FET was originally imposed in 1917 to help defray the cost of World War I. The tax has grown from 3%, when it was incorporated into the Highway Trust Fund in 1955, to its 12% level today.