Last December I wrote about the proposed Transportation and Climate Initiative (TCI), which would require wholesalers of gasoline and diesel in participating states to buy carbon credits to sell their fuel. As a result of the COVID-19 pandemic, the TCI jurisdictions have adjusted their timeline for developing the program, and a final Memorandum of Understanding is now expected in the fall of 2020. TCI notes that work on the program details will continue, as will engagement with stakeholders.
While many sectors of the U.S. economy are reopening in the coming weeks, there are still concerns on how the economy will rebound. The trucking industry is seeking relief in a big way as they hope to push off the Federal Excise Tax (FEX) on new heavy-duty trucks and trailers through 2021.
Many obstacles have plagued the transportation industry during the last 18 months, including driver retainment and freight pay decreases. Those along with many other factors have contribattributed to hundreds of companies shutting down. Industry organizations including the American Truck Dealers believe the suspension of the 12% FEX will help bolster new truck sales as the industry recovers from the impact of COVID-19.
In an effort to reduce greenhouse gas emissions from transportation, 12 Northeastern states and Washington D.C., including Pennsylvania, are weighing a regional program that would raise the price of gasoline. The Transportation and Climate Initiative (TCI) defines their program as a “bipartisan group or Northeast and Mid-Atlantic Jurisdictions” looking to “achieve additional benefits through reduced emissions, cleaner transportation, healthier communities, and more resilient infrastructure.” According to CBS Pittsburgh, their recent plan would require wholesalers of gasoline and diesel in participating states to buy carbon credits to sell their fuel. Critics of the program are quick to point out that the costs of these credits will be passed on directly to the consumer.
Seattle is making an attempt to move aggressively towards cutting the city emissions. In September, Mayor Jenny Durkan signed a bill that would tax home heating oil an additional 24 cents per gallon. This tax would be on top of the existing 10% heating oil tax that currently exists for the residents of Seattle. This tax will take effect starting during the summer of 2020.
The 3rd quarter of the year ended just a few days ago and trucking companies all over the country are reconciling fuel purchases and miles driven to ensure proper International Fuel Tax Agreement (IFTA) tax filings. If you are not in the trucking business, IFTA is just another acronym to be thrown around, but here is a quick run down so that you can look smart at social gatherings or answer a jeopardy question in the future.