Truck Taxes and Revenue

Trucking companies pay significant taxes, and those taxes have been increasing at a rapid pace over the last 10 years. The trucking industry paid $5.3 billion into the Federal Highway Trust Fund in 1992, or 31.4% of the total. In 1987, before recent increases, the average five axle, 80,000 pound tractor-trailer combination truck paid $4,241.50 in federal taxes.

In Michigan, heavy duty commercial trucks paid an average of $1,306.00 in state registration fees. As of 1991-1992, the average heavy duty truck fee was $851, not all of which went into the Michigan Transportation Fund.15 This was an increase of 65% over 1982. Total registration revenues increased from $32.6 million in 1982 to $87.6 million in 1992, or a 169% increase due to a doubling in the number of commercial trucks and the per truck fee increases. Diesel fuel revenue totaled $54.6 million in 1992, up 102.9% from 1982. In total, Michigan Transportation Fund tax collections from the trucking industry increased from $59.5 million in 1982 to $142.2 million in 1992, a 138.9% increase over the ten years. In total, heavy duty commercial trucks paid 11.9% of total Fund revenues.

Compared to other states, Michigan has some of the lowest truck user fees.16 According to the Michigan Trucking Association, total per unit registration fees, considered alone, are similar to neighboring states. For instance, our registration fee of $1,306 per truck compares to $1,308 in Indiana, $2,200 in Illinois, $1,367 in Ohio and $1,900 in Wisconsin. After fuel taxes are added in, assuming 80,000 miles per year, the total user fees in Michigan are $3,495 per truck compared to $5,169 in Indiana, $6,060 in Illinois, $4,875 in Ohio and $5,142 in Wisconsin. On average, the Michigan user fees are 34.2% less than the average of the other four states. While not specifically related to road taxes, the trucking industry does point out that the total tax costs of operating a trucking company in Michigan are considerably higher than the costs in neighboring states. For a typical 20 truck Michigan firm with 30 employees and sales of $1.76 million, the estimated costs total $344,449 for use taxes, workers compensation, sales tax, property tax, corporate tax, unemployment compensation insurance, and miscellaneous fees. The average cost in the neighboring four states is just $307,500.