In a bipartisan effort to amend trucking laws to reduce financial burdens carried by those in the freight industry, Senators Ben Cardin (D-Md.) and Todd Young (R-Ind.) have called for the repeal of the 12% excise tax placed on new trucks and trailers. The tax is part of transportation law under federal purview, but the proposed Modern, Clean and Safe Trucks Act of 2021 would do away with this added expense.
Part of the reasoning behind the push for repeal of the excise tax is that is has the potential to affect innovation negatively. Specifically, proponents of the transportation law repeal claim that electric vehicle development is hindered by the additional costs of the excise tax.
Additionally, many trucking laws and regulations were created nearly a century ago. This was at a time when federal budgeting needs were much different due to growth, the economy, world wars, and other factors. Those calling for repeal claim that transportation law needs have changed and that the current tax is simply no longer needed.
Another part of the equation is the age of the trucking industry’s current fleet. Today, many trucks on the road are ten years old or over, and most still require traditional fuel. Replacing these trucks is costly in and of itself, but the 12% tax adds to the financial burden. Due to the additional tax, repeal proponents argue, fleet managers are less likely to purchase newer, cleaner technologies. This also means that manufacturers are less likely to invest in such technologies.
Engine manufacturers, including Cummins, have voiced support for the effort to repeal. In a statement, Cummins CEO Jennifer Rumsey says, “Cummins supports Sens. Young and Cardin’s effort to repeal the outdated and burdensome [federal tax] on heavy-duty trucks. This tax penalizes those who want to adopt the cleanest, most advanced technologies to reduce emissions and improve safety, and repealing it will help ensure the most efficient technologies are being deployed.”
S. 2435, the bill supported by Senators Cardin and Young, was introduced on July 23, 2021.
To read the full article, click below.
