Sellers and owners of vehicles that are designed for off-highway use but travel over the highway to reach job sites won a partial victory in a recent court case, Gateway Equipment Corp. v. United States. The U.S. District Court for the Western District of New York granted Gateway two out of three motions for summary judgment against the government.

Gateway distributed Flow Boy Live Bottom semitrailers, designed for depositing asphalt on unopened sections of highway. In several earlier cases, other courts had ruled the equipment was not subject to federal excise taxes, but the IRS nevertheless held Gateway liable for the 12% tax on new highway vehicles. This court ruled that Gateway deserved the same treatment as other taxpayers.

Congress may have the last word on this issue: the Senate Finance Committee plans to examine the tax treatment of “mobile machinery” when it renews the Highway Trust Fund taxes later this year.