This study analyzed the tax and fee structure for Kentucky motor carriers and details a possible policy scenario for eliminating the weight-distance tax. The report starts out analyzing detailed revenue and rate information for the motor fuel tax, motor fuel surtax, weight distance tax, IRP registration fees, and intrastate registration fees. Consolidation policies in Idaho and Ohio were reviewed, as well as a previous consolidation proposal in Kentucky. A new consolidation framework was developed, where IRP and intrastate plate fees were increased by 129 percent and the weight-distance tax was eliminated. Projections for weight-distance tax and IRP fees (both current and proposed) were compared to assess the revenue impact on the Road Fund. In addition, the tax/fee burden for motor carriers was assessed to see whether the proposed changes would help or hurt firms of various sizes and operational tendencies. Interstate carriers that log a high percentage of miles in Kentucky, or interstate carriers that run a low number of overall miles per vehicle, would generally see an increased tax/fee burden. Interstate carriers that log a low percentage of miles on Kentucky roads or a high number of overall miles per vehicle would generally see a diminished tax/fee burden. Most intrastate carriers would have to pay more under the proposed policy alternative.

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© 2013 University of Kentucky, Kentucky Transportation Center

Information may not be used, reproduced, or republished without our written consent.

The downloadable document is a revised version released on Dec. 23, 2013.