OOIDA takes wait-and-see approach on push to eliminate federal excise tax

January 29, 2019

Mark Schremmer


The Owner-Operator Independent Drivers Association is waiting to learn how a bill to repeal the federal excise tax on commercial truck sales would affect small-business truckers before it takes a stance on the issue.

During its show on Jan. 25 in San Francisco, American Truck Dealers launched a coalition called Modernize the Truck Fleet with the goal of repealing the 102-year-old tax. Rep. Doug LaMalfa, R-Calif., introduced a bill to eliminate the tax in June 2017.

While OOIDA is not opposed to the repeal, the Association wants to know where lawmakers will turn to look for the lost revenue if the federal excise tax is eliminated.

“Our concern is waiting to see how Congress would look to offset that loss of revenue,” said Mike Matousek, OOIDA’s manager of government affairs. “That is really unknown, which is why we remain on the sidelines. We’re not opposed to repealing the tax, but we need to see how Congress would react and how that would affect the majority of our members.”

The coalition for the repeal includes ATD, Truck and Engine Manufacturers Association, Navistar, Paccar, Volvo, Cummins, NTEA, and the Truck Renting and Leasing Association.

“The truck industry is united, and we have two goals: repeal the FET and find an acceptable replacement for the lost revenue from the FET that provides a long-term solution to help fund our highways and modernize America’s fleets,” ATD Chairwoman Jodie Teuton said during keynote remarks. “We’re joining our efforts this year to include the FET repeal in a comprehensive infrastructure bill.”

Teuton said the federal excise tax, which was enacted in 1917 as a measure to help pay for World War I, can add $12,000 to $22,000 to the cost of a new truck.

However, OOIDA wants assurance that its members won’t end up being on the hook for the loss of revenue before offering its support of the measure.

“Simply repealing it doesn’t give you a complete picture of how it might impact other taxes and fees,” Matousek said. “It’s hard for us to get behind something when these things still are unknown. Once they identify an offset, then we will be able to respond accordingly.”