Clueless Connecticut Governor Taunts Truckers After Approval of $90M Per Year Heavy Truck Tax
Hartford, CT – Connecticut’s governor taunted truckers during a revealing press conference yesterday after state lawmakers approved a hefty highway use tax (HUT) on truckers.
It’s no secret Governor Ned Lamont (D) views the trucking industry as a prime target to be exploited in order to raise revenue for state and local infrastructure projects.
While his previous attempts have failed, Connecticut’s Democratically-controlled General Assembly handed him a major political victory on Wednesday when the legislative body passed a HUT (mileage-based fee) on heavy trucks.
Beginning January 1, 2023, a new mileage tax will be imposed on classifications 8 through 13 (weighing 26,000 pounds and above).
Rates start at 2.5 cents per mile and escalate all the way to 17.5 cents per mile.
It’s projected to bring in $90 million per year.
Speaking at a press conference from the State Capitol Building on Wednesday, Gov. Lamont made it clear that companies operating “big tractor-trailer trucks that rumble their way through the state of Connecticut” are going to have to pay up if they want the “privilege” of continuing to travel on “any highway of the state.”
Critics of the trucker mileage tax urged Gov. Lamont and Democratic lawmakers to reconsider their support.
Joe Sculley, president of the Motor Transport Association of Connecticut, has been vocal about his opposition.
Sculley along with Republican lawmakers warned legislators that many out-of-state truckers will simply find alternate routes in order to avoid the taxes, and thus, the unintended consequences will be that the heaviest burden will fall on Connecticut-based carriers.
In a stupefying explanation, Gov. Lamont welcomed the notion that fewer truckers would be traveling on Connecticut highways.
“I was struck by the comment from the trucker’s lobbyist who said ‘Watch out! A lot of the big tractor-trailer trucks may avoid your highway user fee and end run Connecticut.’ Well that’s not so bad either,” Lamont churlishly replied. “We’ll have a little less traffic on the road… a little less asthma for the people that live along the road and we’ll still have the resources we need to make the investments we have to.”
The Governor was apparently so pleased with that response, he chose to Tweet it out to his more than 75,000 Twitter followers.
The trucking lobby is threatening to have drivers go around Connecticut because of the Highway User Fee. That’s fine. We’ll have less air pollution, safer and better quality roads, and less people with asthma. Looks like the Highway User Fee is already working. pic.twitter.com/yrVYROf0Qq
— Governor Ned Lamont (@GovNedLamont) June 10, 2021
However, Governor Lamont was far from finished displaying his lack of understanding about basic economics and the trucking industry.
He was asked about critics — such as Rep. Whit Betts (R) — who argue the new taxes will simply be passed on to consumers in the form of price increases.
“Let’s not call this a ‘trucker user tax.’ Let’s call it what it is: a tax on every single person in Connecticut,” Rep. Betts said in response to the bill’s passage.
Lamont bristled and responded, “If the price of a widget goes up by a tenth of a cent it doesn’t mean you automatically pass that along. The truckers are going to decide if they cut their margin a little bit.”
He then argued trucking companies enjoy a “30% to 40% [operating] margin” citing one of the largest carriers in the world as an example.
“UPS had their most successful year ever last year! So I’m not losing a lot of sleep that there’s a tiny fee,” he explained.
Perhaps the Governor is unaware that the latest data from the American Trucking Associations indicates 97.4% of fleets operate 20 trucks or fewer, and 91.3% of carriers operate six or fewer trucks.
Therefore, the mileage tax (and the added complexity and costs to comply) will disproportionately impact small business truckers.
Further, operating margins in trucking have historically been incredibly tight with many small carriers often barely able to squeeze out even as much as a 5% margin.
While Governor Lamont may not care about most small trucking businesses, there is one group he and his Democratic allies do value… dairy haulers.
Lamont and the Democrats carved out an exemption for trucks operated by dairy farms.
“The House of Representatives passed the truck mileage tax tonight, but not before voting to exempt the heaviest trucks on the road – dairy trucks – from paying the tax,’’ Sculley told the Hartford Courant. “This just goes to show that the truck mileage tax is not actually about damage to the roads, it’s just about money. Lighter weight trucks will be subsidizing heavier trucks that will be exempt from the tax.”