Repealing Federal Excise Tax on New Trucks Could Accrue Environmental and Safety Benefits: ATRI Research

Real-world environmental and safety benefits could benefit from a repeal of the 12% federal excise tax (FET) on new trucks and trucking equipment, according to research released by American Transportation Research Institute (ATRI).

The tax currently adds an additional $20,000-50,000 to the cost of each new truck purchased, thus acting as a strong deterrent to new truck and trailer sales. 

This new research first estimates the age and annual mileage of the entire Class 8 truck population in the United States, and illustrates how removing the 12% Truck FET can accelerate the replacement of older trucks.

Key takeaways:

·        From an environmental perspective, as a Truck FET repeal increases demand for new vehicles, industry CO₂ emissions will decrease at an accelerated rate. Each year as the industry adds newer, cleaner diesel vehicles to the fleet, emissions will be reduced annually by 1.2 million metric tons of CO₂ over current truck purchases with the Truck FET in place. This equated to cumulative savings of nearly 66 million metric tons of CO₂ over a 10-year period.

·        Safety also shows to benefit from a Truck FET repeal. The accelerated replacement of older trucks reduces the cost of safety technologies, thus adding more Advanced Driver-Assistance Systems (ADAS) equipment to the industry, preventing nearly 750 crashes per year and saving nearly $13.5 billion in crash costs over 10 years.