Colorado bill would remove sales tax on FET in truck leases

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A Colorado bill concerning the removal of sales tax on the federal excise tax portion of truck leases passed the State Senate recently and is awaiting signature by Gov. Bill Ritter.

The Colorado Motor Carriers Association brought HB 1171 forward on behalf of its members who lease trucks within the state. Under current law, the federal excise tax of 12 percent is rolled into the base lease and then is subject to state sales tax; the net effect is that truck operators end up paying state tax on a federal tax.

HB 1171, sponsored by Rep. Ed Casso of Commerce City, will eliminate this tax-on-tax issue and will save truck operators who lease trucks significant money in the future, CMCA said.