Last week, the Circuit Court of Talladega County rendered its judgment limiting the collection of Alabama property taxes on Alabama motor carriers involved in interstate commerce to miles driven in the state.
According to the Alabama Trucking Association, that ruling will result in significant tax savings for Alabama motor carriers that log miles outside the state.
Preliminary analyses by ATA attorneys, indicate that some Alabama motor carriers could save more than $100,000 a year. The ruling applies to taxes collected in arrears for 2012 and 2013, and for taxes to be collected for 2014 forward.
The judgment comes as the result of a suit brought by Georgia based motor carrier, B-H Transfer Co., which has a terminal in Alabama. ATA joined the suit to ensure that the Court’s findings would apply correspondingly to all Alabama-based carriers involved in interstate commerce.
Association officials have long maintained that the property tax on Alabama based vehicles involved in interstate commerce is unconstitutional because the tax is not apportioned. The Association sought to resolve the issue through a legislative solution, but the Alabama Dept. of Revenue rejected its proposal.
ATA Chairman of the Board Kevin Savoy of Greenbush Logistics called the ruling "a major victory for the trucking industry in Alabama."
"This ruling is a testament to the worth of your return on investment of your ATA membership dues," he wrote in an internal memo to ATA members. "ATA values your support, and we will continue to work on your behalf providing quality member services."
ATA President Frank Filgo said his group now sets its sights on ending the state Dept. of Revenue's practice of appraising the value of trucks and trailers based on the Manufacturer's Suggested Retail Price, as opposed to their Fair Market Price. A favorable ruling will provide for additional tax savings for the Alabama motor carrier.