Trucking industry backs Trump tax reform, praises healthcare executive order

by Jeff Della Rosa ([email protected]) 374 views 

The trucking industry supports President Donald Trump’s call for tax reform and urged Congress to pass it by the end of the year. The industry pays the highest corporate tax rate of any transportation mode, said Chris Spear, president and CEO of American Trucking Associations.

The president looks to cut the corporate income tax rate to 20%, from 35%.

“The current tax structure limits many trucking companies ability to invest in their drivers, equipment, safety technologies and improvements in productivity,” said Shannon Newton, president of the Arkansas Trucking Association.

“ATA supports tax reform that encourages trucking companies to invest in new, safer environmentally friendly equipment, critical safety technologies, their drivers and promotion of the safer, more efficient movement of our nation’s goods.”

“Because the trucking industry is responsible for moving so much domestic freight, (existing) tax burdens are passed along to consumers,” she said.

Following are some specific policies the industry supports.
• Decreasing the income tax rate on all business income as many small carriers are set up for tax purposes as “pass-throughs,” Newton said. “Tax reform should not result in the income of such businesses being taxed at a higher rate than traditional corporations.”

• Ending the federal excise tax “to encourage investment in safe and clean technologies,” she said. The tax code should encourage trucking companies to invest in the newest equipment with the most advanced safety technologies, best fuel efficiency and most up-to-date emissions systems, Newton said. Ending this tax and “replacing it with a comparable increase in the diesel fuel tax would encourage new truck and trailer sales and create well-paying jobs for truck manufacturers, dealers and supplies.”

• Simplifying the tax code as it is “unacceptably lengthy and complex,” Newton said.

• Maintaining Section 1031, which “allows business to replace capital goods employed for business or investment with like-kind property without recognizing capital gains,” she said. “This is critical to the trucking industry because it allows carriers to purchase newer and safer equipment and invest in critical facility improvements.”

Spear, who attended Trump’s Oct. 11 speech on the tax plan, said “higher tax rates mean higher transportation costs, which make everyday goods more expensive — hurting lower-income Americans the most. By contrast, the benefits of lowered rates will reverberate up and down the supply chain, from the manufacturer to the small business and individual household.”

In a statement, U.S. Secretary of Commerce Wilbur Ross said the 3.6 million truck drivers in the United States “will directly benefit from middle class tax cuts and will benefit further from the growth spurred by corporate tax reforms.”

The trucking industry also praised President Trump’s executive order to allow people to purchase health insurance through association health plans. The president took “substantive action to improve the lives of millions of Americans, including the 7.5 million employed in trucking-related jobs,” Spear said. “By allowing people to pool together to purchase health insurance plans that are sponsored by larger associations and groups, the administration is helping lower healthcare costs and improve access.”

Nearly 90% of carriers have fewer than six trucks, and with the executive order, these companies can “pool resources and offer affordable healthcare options that meet the needs of their employees,” Spear said.