Another Arkansas bill aims to help truckers

| 2/13/2003

Another measure aiming to help Arkansas truckers facing big state sales tax bills is making its way through the state’s House of Representatives.

HB1130 would exempt commercial vehicles from the state sales tax. The vehicles would still be subject to city and county sales taxes, but those taxes are capped.

The bill would also increase the registration fee on tractor-trailers and other commercial vehicles. The current registration fee for a tractor-trailer is $1,350, according to Rep. Jeff Gillespie, D-Danville, the bill’s primary sponsor; that fee would increase by $270.

Gillespie said the measure was passed by the House Revenue and Tax Committee, but has not yet been scheduled for action on the House floor. Because of Arkansas’ laws regarding tax and fee increases, the measure will have to pass by a three-quarters vote.

“I didn’t want to bring it to a vote until I knew I had the votes,” Gillespie said. “I only have three flat turndowns, so I think if I ran it, it would pass, but I want to make sure.”

Up till now, the state sales tax applied to the entire purchase price of a truck – as opposed to city and county sales taxes, which apply to only part of the purchase price – often leaving truckers with bills in the thousands. Few states charge sales tax on tractor-trailers at that level.

In part because of the tax, only 8 percent of the more than 83,000 large trucks whose owners are residents of Arkansas register their vehicles in that state. For semi-trailers, the figure is even lower – 2 percent. The trucking industry employs more than 110,000 people in the state.

The bill isn’t the only measure on the table in Arkansas to aid truckers there.

HB1030 would cap the sales tax on trucks bought or sold in the state to only the first $1,000 from the sale of a truck and only the first $500 from the sale of a trailer. Rep. Don House, D-Walnut Ridge, that bill’s primary sponsor, said that under current rates, the bill would cap the state sales tax on a truck at $51.25 and on a trailer at $25.63.

The bill originally contained an amnesty provision that would have forgiven back sales taxes on Arkansas truckers who were base plated out of state. However, an opinion issued by the state’s attorney general has derailed that provision. The bill passed the House Jan. 29 by a vote of 84-13 and is now before the Senate Revenue and Tax Committee.

House described his and Gillespie’s bills as “competing measures.” But in an odd twist on the tortoise and the hare, the slowest may win the race. Gillespie said whichever bill was signed last by the governor would become the law.

“Any law is changed by any subsequent law,” Gillespie said.

by Mark H. Reddig, associate editor