Mobile Machinery Tax Showdown Delayed

In early October, Rep. Paul Ryan (R-Wisconsin), with the support of 85 co-sponsors, was expected to introduce his Mobile Machinery Tax Fairness Act in the U.S. House of Representatives. The bill will begin the process of providing the Internal Revenue Service with statutory direction on appropriate federal tax treatment of vehicles licensed to travel on public highways but which, in practice, expend most of their fuel off-road. The hope was to append Rep. Ryan's bill to the bill that would reauthorize the Transportation Equity Act, which funds the Federal Highway Administration and several related agencies. However, that bill, which would authorize federal highway spending for a six-year period, has been delayed for five months while the House Transportation and Infrastructure Committee investigates funding options, so the timeline for securing a resolution of the dispute over levying highway excise taxes on mobile machinery has also been delayed. In the meantime, FRA, along with other members of the Mobile Machinery Coalition, is working with House and Senate leaders to pressure IRS not to issue guidelines of its own until legislative guidance is available.

Rep. Ryan's legislation would provide a statutory definition of "mobile machinery" -- in our sector's case it would include delimbers, loaders, and chippers mounted on mobile carriages -- which would preserve these machines' current exemptions from federal new vehicle excise taxes, tire excise taxes, on-highway fuel taxes, and heavy vehicle use tax.

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