Oklahoma state legislators are trying to figure out a solution to House Bill 2433, a newly minted tax bill that has undesirable financial consequences for the trucking industry.
“Nobody in the House caught it. Nobody in the Senate caught it,” said Representative Bobby Cleveland. “The governor’s office didn’t catch it. Nobody caught it.”
After budget negotiations were at an impasse and during the final week of session, legislators repealed an 80-year-old tax exemption on the sale of vehicles. While they exempted trucks from the motor vehicle sales tax, legislators failed to include trailers or recognize the fiscal impact that the oversight would have on the trucking industry.
The new measure was recently challenged but the Oklahoma Supreme Court upheld its constitutionality by a 5-4 vote, ruling that HB 2433 “does not levy a tax in the strict sense because it removes a tax exemption from an already levied tax rather than levying a new tax.”
In a story published by the Daily Oklahoman, Mike Mattox of Western Flyer XPress Trucking provided details about paying “thousands of dollars in taxes on his purchase of new trailers.” Mattox indicated he will tag his trailers in another state to avoid the tax.
“We just purchased 25 trailers here for new trailers and we had to pay the tax on them,” said Mattox. “It was a little over $10,000.”
While the law is on the books, truck owners must pay the tax — about $625 per trailer — or buy and register the trailers in another state for considerably less.
Representative Jon Echols will introduce a bill to eliminate the problem during the special session to be held at the end of September.