bill in the Kentucky General Assembly would exempt most tractor-trailers
from usage taxes in the state, but as a trade off would slightly
increase registration fees on many trucks.
there is some doubt whether the bill can make it through
the Kentucky House before the end of the regular session
March 7, less than two weeks away.
would exempt vehicles that weigh more than 44,000 pounds – the
top four tag weights in the state – from the usage tax. Since
all sales taxes in Kentucky go to the general fund, the tax
on trucks is called a usage tax so the proceeds will go to
pay for roads. However, the tax is not only applied against
the purchase or sale of a truck. If a truck previously tagged
elsewhere moves into the state, the usage tax is applied
to the current value of that truck.
usage tax on a $110,000 tractor-trailer purchase in Kentucky
would run $6,000.
part of the proposal to cut the tax, annual registration
fees on those top four categories would increase. According
to information on the General Assembly’s Web site, on trucks
from 44,001 to 55,000 pounds, the bill would increase from
$544 to $609; on trucks from 55,001 to 62,000 pounds, it
would increase from $882 to $947; on trucks from 62,001 to
73,280 pounds, it would hike fees from $1,125 to $1,190;
and on trucks from 73,281 to 80,000 pounds, fees would go
up from $1,260 to $1,325. In addition, a $3 fee truckers
pay to counties would increase to $20.
the current law remained in place, many larger truck firms
would likely move their truck registrations to an office
in another state, Ned Sheehy, president of the Kentucky Motor
Transport Association, said. However, owner-operators who
cannot afford to have an office in another state would be
forced to pay the usage tax on their trucks. Even the owner
of a 10-year-old truck previously base plated in Oklahoma
would have to pay a usage tax on that truck’s current value.
is intended to relieve them of that tax burden.
are the fifth-highest taxed state in the country,” Sheehy
said. “It doesn’t take a rocket scientist to realize what
the tax structure has done to the industry – it’s kicked
there is little time left in the session, addressing the
issue is vital to the trucking industry, Sheehy said. If
the House bill does not move forward, one avenue being pursued
by the trucking industry in the state is an amendment to
a bill in the Senate.
are currently looking at that possibility,” he said.
has historically had pretty unfriendly tax policy toward
small-business truckers,” Todd Spencer, executive vice president
of OOIDA, said. “This is an opportunity to address those,
and it’s an opportunity we should seize,”
truckers from other states had registered in Oklahoma. However,
under new IRP guidelines that go into effect this year, most
of those truckers will have to return their base plates to
their home states. Lawmakers in several states, such as Arkansas,
have introduced bills to remove that tax burden so smaller
operators can afford to base plate at home and remain in
H. Reddig, associate editor