Truck Excise Tax vs Other Trucking Taxes: Key Differences

• Truck excise tax vs other trucking taxes: excise is a one-time tax on the first heavy-vehicle sale; others include annual use, fuel, mileage, and registration taxes.
• Truck excise tax is paid at purchase; other trucking taxes are ongoing.
• Excise is 12% of the sales price; others depend on weight, miles, fuel, or usage.
• Excise funds highway infrastructure; other trucking taxes support fuel systems, environmental, and administrative needs.
• Sellers collect excise via Form 720; other trucking taxes are filed by owners/operators.

Overview of the Truck Excise Tax?

Truck Excise Tax (also known as Federal Retail Excise Tax (FET)) is a 12% federal tax on the first retail sale of heavy commercial vehicles that surpass the federal weight thresholds. The tax covers:

Trucks and tractor-trailers that are made for highway use and that have a Gross Vehicle Weight Rating exceeding the specified one. Trailers and semitrailers of certain sizes. The tax is declared through IRS Form 720, Quarterly Federal Excise Tax Return (IRS No. 33).

The tax is charged once at the sale and doesn’t occur for that vehicle unless it is under certain conditions. It’s added to the dealer’s invoice, and the seller sends the amount to the IRS.

ALSO CHECK - Truck Excise Tax Deadlines: Important Dates You Shouldn’t Miss

What Are Other Trucking Taxes?

1. Heavy Highway Vehicle Use Tax (HVUT)

• This is a yearly tax that truck owners have to pay if they use their heavy vehicles (those with a gross weight of over 55,000 lb) on public highways.
• Tax payer has to submit the IRS Form 2290 every year for trucks that are still in service.
• The amount of the tax depends on the weight class (up to a specified maximum).

2. Fuel and Diesel Taxes

• Tax on fuels at the federal and state levels is determined by the number of gallons used.
• They are the charges at the gas station and serve as the source of funds for the federal and state highway systems.

3. Mileage-Based or Use Taxes & Permits

• Certain areas have International Fuel Tax Agreement (IFTA) reporting or mileage-based fees that are applicable to the operations of non-residents.
• The taxes are allocated based on the number of miles traveled in various states.

4. Registration & Licensing Fees

• Periodic fees for apportioned vehicle registration (IRP) and operation permits.
• All these are simply called other trucking taxes since they refer to operational activities and not vehicle purchases.

Quick Comparison Table

Feature	Truck Excise Tax	Other Trucking Taxes
When Paid	One-time at retail sale	Annual or periodic (used vehicle operation)
Basis	Sales price (12% federal excise)	Vehicle weight, miles, fuel usage, registration
Primary IRS Form	Form 720 (Retail tax)	Form 2290 (HVUT), fuel & state returns, registration forms
Paid By	The seller passes the cost to the buyer	Owner/Operator or fleet manager
Purpose	Infrastructure cost allocation via vehicle purchase	Road maintenance, fuel infrastructure, and regulatory compliance

Why This Distinction Matters

Understanding the difference between the truck excise tax and other trucking taxes will help a trucking business plan its finances and comply with the law. Excise taxes might bring a steep price hike to the cost of new equipment, whereas ongoing taxes like fuel and mileage-related ones will be more about operating costs, cash flows, and yearly profits.

ALSO CHECK - Step-by-Step Guide to Filing Truck Excise Tax Online

Conclusion

Gaining a clear understanding of truck excise tax vs other trucking taxes will help trucking companies to stay on top of compliance and financial planning. The one-time excise that is levied on purchase and the repetitive obligations like HVUT and fuel taxes are all different in terms of triggers, paperwork, and their impact areas. If you handle tax matters strategically, you can avoid unwanted crises, have a compliant fleet, and keep your operating costs down.

Do you want to make your excise tax filing as easy as possible? Go to efile720.com and get professional help and file your IRS Form 720 with ease and convenience.

FAQs

1. What is the main difference between the truck excise tax vs other trucking taxes?
   • The truck excise tax is a one-time federal levy on the first retail sale of qualifying heavy trucks.
   • In contrast, other trucking taxes are recurring taxes, such as annual use tax, fuel tax, and mileage-based fees that apply during vehicle operation.
2. Do all trucks have to pay the truck excise tax?
   • No, only new heavy trucks, tractors, trailers, and semitrailers that meet specific gross weight thresholds are subject to the truck excise tax.
   • Other trucking taxes depend on vehicle use and registration status.
3. Is the truck excise tax refundable?
   • Typically, no. The excise tax is a final tax on the first retail sale.
   • Other trucking taxes (like HVUT) may have credits or refunds in certain state programs.
4. How is the truck excise tax filed with the IRS?
   • The truck excise tax is reported on Form 720 each quarter.
   • Other trucking taxes use Form 2290 (HVUT) or state fuel and registration filings as required.
5. Does paying other trucking taxes affect the truck excise tax?
   • No, paying other trucking taxes (like HVUT or fuel taxes) does not negate or reduce the truck excise tax liability.
   • They are separate obligations under federal and state law.