Okla. Tax Commission Must Pay Fine for Truck-Tag Scandal

July 27, 2006

A federal appeals court said July 25 that the Oklahoma Tax Commission will have to pay a $28.5 million fine because of a multi-state lawsuit over truck tags.

Led by Illinois, 13 states filed complaints against Oklahoma, saying they were cheated because the Tax Commission allowed truckers to pay reduced fees on bogus mileage projections. Oklahoma has used the $1.4 million a month generated from the tags to help pay for state government and schools.

The Tax Commission sued in 2002 to try and block any sanctions that might result from the complaints. On July 25, the 10th U.S. Circuit Court of Appeals affirmed a district-court ruling that denied the state’s motion to prevent the fine.

“The 10th Circuit had to address and decide a very unique issue,” Tax Commission spokeswoman Paula Ross said. “Although we are disappointed, we knew that this would be a very complicated decision.”

Ross said that Tax Commission attorneys hadn’t yet decided if they would appeal the decision.

Oklahoma is one of 48 states and 10 Canadian provinces that are part of an agreement that allows truck owners who travel throughout the U.S. and Canada to register their vehicles and pay their fees in one state. That money then is split, based on the vehicle’s expected travels.

International Registration Plan, which administers the agreement, ordered the tag fees withheld until Oklahoma settled the dispute. The Tax Commission has done so since October 2004 to cover the $28.5 million, Ross said.

“It’s not additional money that the state will need to collect,” she said. “The majority of the money has been paid.”

Since June 2002, four former Tax Commission employees and four former trucking agents have been indicted for allegedly using schemes to cheat the state out of money from truck-tag revenues.

Information from: Tulsa World, www.tulsaworld.com.

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