Ark. Senate Committee Endorses Truck Tax, Sets Up Showdown
The action comes two days after the House overwhelming passed a 3-cent gas and diesel tax backed by Gov. Mike Huckabee.
Both plans would generate roughly the same money — $59 million annually from the Senate bill and $55 million from the House proposal.
But the Senate version would place the burden on heavy tractor-trailer rigs, while the House plan would raise most of its money through the gasoline tax on cars.
"This addresses repairing the roads in a fair way, because we know the cars out there are not tearing them up, it's the heavy trucks," said Sen. Cliff Hoofman, sponsor of
he truck tax. "One heavy truck causes more damage to your road than 9,600 cars."
The Senate Revenue and Taxation Committee sent Hoofman's bill to the full chamber on a 4-1 vote. The committee is to consider the House-passed legislation Wednesday.
The gas and diesel tax cleared the House 85-14 after Huckabee convinced half his fellow Republicans to set aside concerns about raising taxes. It is paired with Huckabee's $575 million bond issue, also approved by the House, which would need voter approval to become law.
The House plan would add an extra penny to the gas and diesel taxes each of the next three years. The diesel tax is expected to generate $15 million and the gas tax $40 million when fully
mplemented, according to the highway department.
Hoofman's highway plan would impose a 3.5-cent per mile levy on trucks weighing more than 73,280 pounds. To offset part of the tax, the legislation would lower the annual registration for such trucks from $1,350 to $350.
Under both plans, cities and counties each would get 15 percent of the money, with the rest going to the state Highway and Transportation Department. The House plan would reserve $10 million annually to pay off the bonds, if approved by voters.
Opponents of Hoofman's bill include the trucking industry and the state's Economic Development Department, which contends the truck tax would drive businesses to other states.
"This proposal concerns us because it would increase the cost of manufacturing and distribution here in Arkansas," said Barbara Pardue, the state's economic development director.
Five states — Kentucky, Idaho, New Mexico, New York and Oregon — have weight-distance taxes, said Lane Kidd, president of the Arkansas Motor Carriers Association, which represents 160 trucking companies.
Kidd said the truck tax would amount to a 92 percent tax hike and would be equivalent to a 17-cent-per-gallon diesel tax increase.
"We would in Arkansas have by and far away the highest cost of transporting goods in any state in the South," he said.
Kidd also raised concerns that the weight-distance tax would be overturned in the courts, citing a 1980s tax that was declared inequitable because it exempted Arkansas-based trucks.
Hoofman's bill includes exemptions for farm trucks, lumber trucks, those hauling livestock or poultry feed and trucks owned by cities, counties or the state.
Sen. Kevin Smith said he voted for Hoofman's bill in committee as a courtesy to the senator. But Smith also cited legal concerns and said he probably would not support it on the
loor. Smith plans to handle the Huckabee-backed highway plan passed by the House.
