The Iowa Farm Bureau’s president says it’s unfair to charge a “road use” tax on farmers as they drive their equipment off the road.
Getting rid of the fuel tax exemption for diesel fuel that’s used on farms is among the ideas the Iowa DOT’s director has drawn up for dealing with a short-fall in the state’s road construction budget. It would yield an estimated $38 million in new tax revenue for the state’s Road Use Tax Fund.
“For a farmer to think that when they’re tilling or working in the fields or harvesting their crops they’re paying a road tax is quite unfair,” Iowa Farm Bureau president Craig Hill says.
Iowa Ag Secretary Bill Northey agrees.
“The reason those are not taxed is the vast bulk of that fuel is used on a farm, off the road,” Northey says, “and so, therefore, that equipment doesn’t spend time on the road like the other gas-tax-payers do.”
Northey says it is time to rebuild crumbling road and bridge infrastructure in rural iowa, but farmers believe increasing the “user fee” for those who drive on the state’s transportation system is a better choice than raising taxes on farm fuel.
The Iowa Farm Bureau has called on legislators to raise the gas tax.
“Certainly the need is there and we’ve described the need for several years,” Hill says. “A deterioration of our roads and infrastructure is going to have an economic impact on the state of Iowa, so we look for appropriate taxation, what has a correlation to usage and the fuel tax, of course, has that highest correlation. Out of state users will pay about 15 percent of the bill.”
Hill and Northey made their comments this afternoon during taping of the “Iowa Press” program which airs tonight at 7:30 on Iowa Public Television.