RALEIGH, NC – An attempt to increase the North Carolina highway use tax rate and elimination of the cap on use taxes paid on commercial trucks has died in the state’s legislature, according to the Truck Renting and Leasing Association (TRALA), which opposed the bill. The failure of the proposal to move out of the legislature followed an intense campaign consisting of a grassroots effort and direct contact with state legislators by TRALA representatives and other industry allies, including the North Carolina Trucking Association.

The proposal under consideration for increasing the highway use tax included a potential doubling of the use tax from its current rate of three percent of a vehicle’s retail value to six percent. The current use tax must be paid when applying for a certificate of title for a vehicle. Even more concerning for commercial truck owners was the possibility that the legislature would either eliminate or raise the current cap on highway use tax for such trucks. The cap is currently set at $1,000 for trucks over 26,000 pounds. The elimination of this cap would have had a significant and direct impact on the tax burden of commercial truck owners.

The legislature adjourned on Aug. 2, without reaching an agreement to raise the highway use tax. As an alternative method of raising transportation funds, the legislature increased the annual registration fee for passenger vehicles by $8 and directed the increase to go to the North Carolina Turnpike Authority.

Originally posted on Fleet Financials