WASHINGTON, D.C. — A powerful coalition of transportation stakeholders is renewing its campaign to force Congress to abolish the 12% Federal Excise Tax (FET) currently applied to the first retail sale of new heavy-duty commercial vehicles. Representing a broad cross-section of the industry, the American Trucking Associations, American Truck Dealers, and the Zero Emissions Transportation Association are arguing that the century-old tax serves as a massive financial barrier to fleet renewal and the adoption of modern, low-emission technology.
This tax remains one of the most contentious levies in the industry, effectively acting as a penalty on safety and sustainability. While federal regulators push for cleaner engines and advanced safety systems, the government simultaneously collects a 12% premium on the purchase price of these updated units. Carriers and owner-operators have long viewed the FET as a relic of a bygone era, one that now fundamentally conflicts with national environmental goals and the need for a modern, efficient supply chain.
Legislative efforts to kill the FET have hit a wall in recent sessions despite bipartisan backing. The Modern, Clean & Safe Trucks Act, introduced by Senators Todd Young and Ben Cardin alongside Representatives Doug LaMalfa and Chris Pappas, failed to move through both chambers. Similar attempts have surfaced annually since 2017, yet the tax remains in place, adding up to $20,000 to the cost of a standard diesel tractor and more than double that amount for battery-electric models. With heavy-duty trucks accounting for 24% of all transportation carbon emissions, industry advocates argue that penalizing the purchase of new vehicles is counterproductive to the stated goal of cleaning up the nation's freight corridors.
What This Means for Drivers
For the average owner-operator, the 12% FET represents a massive barrier to entry when looking to upgrade to a newer, more reliable rig. This tax forces many to keep aging, high-maintenance trucks on the road longer than they would prefer, directly impacting daily profitability and uptime. As trucking companies are hiring for roles that require updated, compliant equipment, the removal of this tax would likely lower the barrier for independent contractors to invest in their own businesses. A repeal would put thousands of dollars back into the pockets of the professional CDL-A driver, allowing for reinvestment in better maintenance, safety features, and overall vehicle health.
Industry Reaction
Scott McCandless, chairman of the American Truck Dealers, has been vocal about the contradiction between federal mandates and federal taxes, noting that if the government wants a cleaner fleet, it must stop taxing the very equipment that makes that possible. Chris Spear, President and CEO of the American Trucking Associations, maintains that if lawmakers are truly serious about safety and environmental stewardship, the FET must become a front-burner issue. The consensus among these groups is that the current tax structure acts as a direct impediment to the fleet operators who keep the American economy moving.
Key Points
- The 12% Federal Excise Tax adds tens of thousands of dollars to the purchase price of new heavy-duty trucks.
- Heavy-duty vehicles represent only 4% of road traffic but generate nearly a quarter of all transportation carbon emissions.
- Legislative attempts to repeal the FET have stalled in Congress every year since 2017.
- Advocates argue the tax prevents the adoption of cleaner, more efficient, and safer vehicle technology.
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