Increased truck taxes are one viable way to raise additional revenues; however, unit
taxes would have to be raised a great deal to raise significant levels of revenue. For
instance, the diesel tax raises just $5.6 million to $6.9 million per penny compared to
$45.7 million for a penny of gasoline tax. It is also important to note that Michigan
truck taxes went up 138.9% between 1982 and 1992. However, Michigan truck user taxes are
some of the lowest in the country even after consideration of sales taxes, and both
registration fees and fuel taxes are lower than in neighboring states.
The rationale for raising truck taxes further is that trucks are still not paying their
full share of costs imposed on Michigan roads. There are no Michigan cost allocation
studies, but the latest federal study indicates that trucks are paying 86% of their costs
nationally. Studies in fifteen states indicate an average cost recovery of 96%; however,
those states have higher fuel taxes than in Michigan. In those fifteen states the average
gas tax with various add-ons is 23.6 cents compared to 14.5 cents per gallon in Michigan,
making the Michigan rate about 60% of the rate in these fifteen states. It is likely that
Michigan's fees are no higher than the rate these fifteen states.
On the other hand, there is a very good rationale for keeping truck taxes down. Lower
truck user taxes offer one of the few competitive advantages Michigan has on the tax
front, and overall state taxes on truckers are higher in Michigan than in neighboring
states after workers' compensation, corporate taxes and unemployment taxes are taken into
account. An increase in truck taxes should not be taken lightly in a state with extensive
movements of heavy industrial products and components for the auto industry, and where
there is extensive aggregate mining.
It also must be realized that such an increase will be passed on in the form of higher
costs for Michigan manufactured goods, and for the goods that Michigan residents buy in