U.S. sensors Ben Cardin (D-MD) and Todd Young (R-IN) passed legislation last week that would abolish federal excise tax (FET) on heavy trucks and trailers.
The FET was founded more than 100 years ago and was enacted to pay for the First World War. The current 12 percent FET is the highest percentage of excise duty levied on a product, but remains an unpredictable and minimal source of income for the Highway Trust Fund. The senators also said the tax discourages private investment in cleaner, safer, and more modern truck fleets.
“Our tax policy is one of the most effective ways Congress can promote cleaner, greener technologies. The current federal excise tax has become an obstacle to progress, ”Cardin said. “I am proud to support Maryland manufacturers in their efforts to develop and deploy cleaner, safer technology in our trucking industry. Our legislation will stimulate growth and competitiveness while making our roads safer and less polluted. “
According to the Senators, the 12 percent FET increases the cost of a new heavy truck, tractor, or trailer by between $ 12,000 and $ 22,000. With more than half of Class 8 trucks over 10 years old, the FET is stifling investments in new trucks despite significant improvements in carbon dioxide reduction and fuel efficiency.
The legislation is supported by groups in the trucking industry.
“On behalf of the trucking industry, we thank Sen. Young and Sen. Cardin for their bipartisan legislation repealing the FET that will result in cleaner, safer trucks on the road,” said Steve Bassett, ATD chairman and dealer director of General Truck Sales in Muncie, Indiana “With most heavy trucks over a decade old, getting this bill through is critical to helping America modernize its aging truck fleet.”