So you want to "own " your own company

That you should not have to pay.

Who did you lease to? What do you pull? We are here in IL and pay 87% pulling dry van or flatbed.

 

It is too bad that you don't live in one of the states that have a sales tax exemption for class 8 equipment. In my state if you have an MC number or lease to a carrier then you can get the exemption as long as you title it in the state.

 

Would be nice(er) if congress passed the bill currently sitting in Ways & Means to remove the FET on Class 8's also. The EPA 2010 stuff caused manufacturers to add about a $9K "surcharge" onto new units for all the junk that EPA was making them put on to be complaint. Removing the 12% FET on new units would "encourage" folks to purchase new - well, not counting the 20%, first-year-as-soon-as-you-drive-it-off-the-lot-automatic-depreciation. I could deal with one of these, but "throwing out" $40K in year one (even though the FET is a "write-off").

Florida is a 6% sales tax on new purchases/reg's, pretty much any way you slice it - one time fee - but there nonetheless and should be factored into any business model.

Rick

 

##### Bill!!! I think I know who I would talk to if I got a truck. Your not to far from me up here.

 

We didn't always have a FET on class 8 equipment. There is no reason we should have FET on trucks and trailers. It adds a lot of money to any new purchase. The government is not likely to take the tax off at this point. They make too much money. On the other hand, it would encourage many to purchase new equipment if the tax were removed.

Most states that charge sales tax only do it once. I believe that Georgia still charges some sort of property tax on vehicles each year. It is based upon the value of the vehicle.

Government regulations do thousands of dollars to the purchase price with all the useless EPA regulations.

 

The bill I refer to is the: Heavy Truck Fairness Act: http://www.gpo.gov/fdsys/pkg/BILLS-112hr4321ih/pdf/BILLS-112hr4321ih.pdf

Which would remove the FET on Class 8 & Trailers. The "intent" of the bill was to "stimulate the manufacturing sector", by encouraging people to purchase new trucks - as well as having the (potential, but not mentioned) side-effect of getting older units off the road and replacing them with EPA compliant equipment.

When you think about it:

New VNL780 - $135,000
FET $ 16,200
FL 6% $ 8,100

TOTAL: $159,300

Now, take the fact that a year old truck of the same model goes down about $35K - and you "lose" $59.3K, as soon as you drive to off the lot. Some would say, "oh, but you can write it off" - but the fact is, you still have to COME UP WITH THE $$ to pay it in the first place. And if you've built it into your FINANCING, you're paying INTEREST on that $$ too.

The downside of the bill is - it provides for replacing the revenue of the FET, with an additional 6.4 cents per gallon of diesel tax fuel - which may end up being the bills UNDOING - as people who aren't going to benefit because they're not planning on buying NEW equipment - are going to complain they're being "unduly taxed".

Florida is a one-time 6% sales tax - but we have NO personal property, corporate or state income taxes here - which kinda balances the "insurance is more expensive in florida" part of the equation, for me at least.

I'm looking at 1-2 year old trucks - in large part due to the FET and 1st years depreciation. While I could likely "scrounge up", the $16K for the FET, when combining that with the 1st years hit in value - I just can't stomach it (much as I'm a spoiled brat and would love a brandy-new truck).

I would URGE EVERYONE - even if you do NOT plan on buying new equipment - to drop an email to your "elected crook" in Washington, urging their support of this bill...

Rick

 

I don't think that I would be in favor of the bill since it would increase the federal tax on fuel. I don't plan on buying new equipment and supporting the bill would increase my operating costs. While $0.065 doesn't sound like a lot of money, multiply that by 100-120 gallons of fuel a day and it can mount up to a lot of money over the course of a year, even for one truck. When you multiply it out it will increase operating costs from about $1,700 to over $2,000/year per truck. Essentially, those who don't buy new equipment will be subsidizing those who do if we support this bill. I think that it would be good to eliminate the FET, they are only replacing it with a bill that will generate more revenue than the FET.

 

As you mentioned earlier - the bill has little chance of passage - without replacing the FET revenue somehow. Conversely, the potential of INCREASING REVENUE, by increasing fuel tax - may give the bill a greater chance of being passed.

Interesting though that: Truck Renting and Leasing Association, National Truck Equipment Association, American Trucking Association support the bill - even though ATA members would also see increased operating costs as a result of the fuel tax increase.

Since the go-nowhere/do-nothing (except screw US OVER) gov't is involved - I doubt we'll see anything positive come out of this ANY WAY it goes. Knowing them, they'll only DECREASE the FET, and INCREASE the fuel tax.

Rick

 

The ATA members may be able to get some sort of exemption. Government does it all the time. Whether they do get an exemption or not, they can buy equipment for less than smaller carriers and owner operators and since the FET is based upon the purchase price, they will pay less than smaller carriers. They already get significant discounts on fuel so they may not be hurt as much as smaller carriers and owner operators. And don't forget that many of the larger carriers have moved away from company drivers to having more owner operators and using those with authority to pull their trailers. You can be if the ATA is for something then it is not in the best interest of smaller carriers and owner operators.

 

ATA seems to generally support raising fuel taxes to make sure roads have enough money to get paid for. Do the feds play loose and fast with this money like some of the states do by spending it on pork projects that have nothing to do with highway maintinence? That's one good thing about Tennessee, all the fuel tax money collected by the state goes directly to highway maintinence not anything else, and you can tell it the roads are good here. It ought to be mandatory like that in every state and maybe they wouldn't be trying to impose toll roads on interstates that have long ago been paid for and already have more than enough fuel tax revenue coming in to cover maintinece if they would quit wasting that money on other pet projects...