Transportation - Sales Tax

January 11, 2020

Share this article:

Transportation (in sales and use tax law) generally refers to companies who are in the business of transporting tangible personal property for others in interstate and/or intrastate commerce. This movement can be by the means of rolling stock trucks, truck tractors, trailers, etc. States most often require transportation companies to first be registered as an "Interstate Common Carriers" (ICC) as prescribed under federal law. Once this classification is obtained, a transportation company, may then claim very specific sales and use tax exemptions. These exemptions can include exemption from tax on the purchase of the transportation equipment, and can be extended by a state to the tangible personal property used to the repair the equipment.


In states that tax specific services, some have also granted sales and use tax exemptions to services (repair and maintenance labor) rendered on the actual transportation equipment. Approximately two-thirds of the states grant the above cost saving exemptions for the purchase or lease of transportation equipment (rolling stock). While only one-third of the states grant the above cost saving exemptions on repair parts to the equipment.


The transportation industry is an extremely complicated industry to understand when attempting sales and use taxes. Many transportation, specially trucking operations, do not have accounting personnel who study the business operations and exemptions. As a result, many trucking operations fail to advantage of these exemptions missing out on thousands of cost savings.

Exemptions are statutory, not loopholes, and are closely regulated but can save companies significant cost. To take advantage of these exemptions, a company needs to be a transportation company. Many questions arise when companies look to take advantage of these exemptions.


  • Dose our fleet qualify as a transportation company to save on sales tax?
  • Do regulations vary state-by-state?
  • What is the criteria for vehicle to be exemption from sales taxes?
  • What is and is not exempt?


Our skilled team is prepared to assist you in evaluating your operations to answer questions, finding and staying on the road to compliance while maintaining the maximum benefit from the available sales tax exemptions.

Connect with us:

fleet insights

A man is standing on the back of a semi truck.
By National Fleet Services June 11, 2025
DOT violations are breaches of regulations set by the Department of Transportation (DOT) and the Federal Motor Carrier Safety Administration (FMCSA).
By Matthew Bowles June 10, 2025
Operating a fleet of Class 8 trucks across state lines requires more than just logistics know-how—it demands rigorous compliance management. For fleet managers, navigating vehicle titling, licensing, and permitting isn’t optional. It’s critical to ensuring that every truck in your operation stays legal, safe, and on the road. This guide breaks down what you need to know to keep your fleet compliant and avoid costly delays. 1. Vehicle Titling: Get the Foundation Right Titling establishes legal ownership and is the first step in fleet compliance. Every Class 8 truck must be properly titled in your base state before registration or operation begins. What Fleet Managers Should Do: Maintain a centralized record of bills of sale, MCOs, and lienholder documents Transfer out-of-state titles promptly to avoid IRP delays Ensure lienholder-released titles are followed up and filed ⚠️ Pro tip : Title delays can stall fleet deployment and interrupt insurance coverage. 2. Licensing: Apportioned Plates Under the IRP To operate across state lines, trucks need apportioned license plates through the International Registration Plan (IRP) . IRP registration distributes fees based on mileage traveled in each state. Responsibilities for Fleet Managers: Maintain an active IRP account in your base jurisdiction Track mileage by jurisdiction using ELDs or fleet software Renew apportioned plates annually and prepare for random audits 💡 Avoid fines by ensuring mileage reports are accurate and submitted on time. 3. Permitting: Crossing Borders Without Breaking Rules Permits are essential for operating legally in multiple states. As a fleet manager, you need to stay ahead of several layers of permitting requirements: Key Permits to Track: UCR (Unified Carrier Registration) – Required annually for all interstate carriers IFTA (International Fuel Tax Agreement) – Requires quarterly fuel tax reporting OS/OW Permits – For loads exceeding legal size/weight limits Trip & Fuel Permits – Temporary coverage for trucks not registered under IRP/IFTA 📍 Tip : States have different rules and fees—coordinate permits in advance when routing oversize loads. 4. Avoid These Costly Mistakes Even small lapses in compliance can have serious consequences. Watch out for: Missed IRP or IFTA renewals Inaccurate mileage or fuel records Unpermitted oversize or overweight loads Unresolved lienholder title issues 🚨 Non-compliance can lead to vehicle detainment, delivery delays, and financial penalties. 5. Best Practices to Stay Ahead Smart fleet managers follow systems—not just checklists. Assign a compliance coordinator on your team Use fleet management software to track renewals and records Work with experts like National Fleet Services LLC to simplify audits and filings Need Help Managing Fleet Compliance? At National Fleet Services LLC , we help fleet managers handle the complexity of Class 8 vehicle compliance—from titling and IRP setup to fuel tax reporting and permit tracking. ✅ Minimize downtime ✅ Avoid fines and audits ✅ Streamline operations Contact us today to schedule a compliance review or set up a custom fleet management plan. 📞 Call us at (800) 918-3035  📧 Email: Daisy Rangel @ drangel@mailnfs.com
June 5, 2025
(But Really Should If You Operate Commercial Vehicles)