New York Supreme Court Rules Tax and Decal Fee Unconstitutional
New York’s Supreme Court ruled Feb. 1 that the state’s highway-use tax and decal required of out-of-state truckers are unenforceable, awarding a victory to the Owner-Operator Independent Drivers Association in its class-action lawsuit.
JohnstonOOIDA had argued that the fees constituted an undue burden on interstate commerce in violation of the Commerce Clause of the U.S. Constitution, since out-of-state trucks travel fewer miles in the Empire State than New York-based trucks.
“A number of similar tax cases were fought against states back in the '80s and '90s, and the states lost every one of them,” said OOIDA President Jim Johnston, who predicted that the court ultimately could award his members up to $20 million in damages and fees. “Given that history, we were shocked that New York even thought they could get away with this unconstitutional tax. The amount for the New York HUT/decal is $19, which is not huge, but if other states were to implement this tax, it would be huge — collectively and in administrative costs.”
While the New York State Motor Truck Association was not a party to the lawsuit, Kendra Hems, its executive director, applauded the court’s decision.
“We congratulate OOIDA on the win,” said Hems, who noted that New York is one of just four states with a ton-mile tax, one that is assessed on all of the state’s roads except for the Thruway. “It’s another tool that we’ll use as we continue to fight to repeal the tax in its entirety.”
