Connecticut cancels diesel tax hike, but will it actually help truckers?
Truck drivers will not swallow a big diesel tax increase this month, after Connecticut lawmakers recently canceled it. But truckers said they may not save much money because of a new state mileage fee.
Truck drivers will not swallow a big diesel tax increase this month, after Connecticut lawmakers recently canceled it. But truckers said they may not save much money because of a new state mileage fee.
“When you get to Connecticut, they charge you 10 cents,” said Roberto Liriano, a big rig driver from New Jersey. “Plus the diesel, it's going to be crazy.”
Every time truckers pull up to a gas pump, they brace for sticker shock.
“Through the roof,” said Atlanta-based driver Ray Knight. “It's ridiculous.”
The average diesel price in Connecticut is $4.08 per gallon, according to AAA. While still high, that’s almost two bucks cheaper than one year ago.
DIESEL TAX FROZEN
Now, truckers are getting a little relief.
Connecticut's diesel tax was scheduled to jump 12 cents this month. Each summer, the tax adjusts automatically, based largely on wholesale fuel prices. But the new state budget canceled this year’s increase to save truckers money.
“Our state budget was crafted with an eye toward middle-class tax relief and investments that grow our economy and protect our quality of life,” said Connecticut Senate Majority Leader Bob Duff (D-Norwalk). “We're always looking for ways to help businesses and working families, and freezing the diesel tax is just one more way to do that.”
Last summer, the tax went up 9 cents. State lawmakers extended a 25 cents-per-gallon “gas tax holiday” to automobiles but not diesel customers.
“We're barely making it out here now with the cost of living,” said Knight. “It's so high. Something's got to change.”
SAVINGS OFFSET BY NEW MILEAGE TAX
You could benefit from the freeze on diesel taxes. Everything from groceries to home heating oil is transported on a truck.
A semitruck holding 120 gallons of fuel will save $14.40 each time it fills up. But the savings could be canceled out by Connecticut's new truck mileage fee, which costs up to $19 to drive the entire stretch of I-95.
Gov. Ned Lamont pushed the Highway Use Tax to pay for road and bridge construction, after dropping his controversial proposal for highway tolls. The tax was projected to raise $45 million by July 1. The state collected $18.6 million as of May 1, according to the Connecticut Department of Revenue Services.
Some out-of-state truckers are still unaware of the mileage fee.
“No, this is the first time I hear that,” said Luzvilla Seymour, a tractor-trailer driver from Texas.
Republicans unsuccessfully tried to repeal the Highway Use Tax this year, arguing that it’s unnecessary because the state’s Special Transportation Fund is running a surplus.
“We have an opportunity to sunset this policy before it grows deep roots, joining other states that have abandoned their own versions of the tax,” said state Rep. Holly Cheeseman (R-East Lyme) in March.
But Lamont has argued that the STF surplus is largely due to federal infrastructure aid, which requires a dedicated revenue stream from the state.
“PREDICTABILITY IS IMPORTANT”
Beyond the mileage fee, the Motor Transport Association of Connecticut said the state’s diesel tax is too volatile. The industry prefers a fixed rate.
“Like any business, whether it be yours or mine, predictability is important, so you can predict costs,” said MTAC president John Blair.
Truckers like Liriano agreed.
“Oh yeah, of course,” he said. “Because you know how much you're going to spend every day, every week.”
Top Democrats and Lamont's office said they’re open to changing the diesel tax formula, but they want to see how this year’s freeze works out first.
