New Truck Fees May Lead to Social Unrest

The Transportation Ministry on Friday presented a system for levying a fee for using federal roads on owners of 12-ton trucks.

The ministry unveiled the plan, which is to enter into force in November 2014, at the St. Petersburg International Economic Forum.

Truck owners have already called the measure draconian and threaten to set up road blocks in protest.

Last week Prime Minister Dmitry Medvedev signed an act under which owners of trucks with a maximum load capacity of  12 tons will pay 3.5 rubles ($11 cents) per kilometer traveled on main highways — as a means of compensation for the wear and tear to the road surface caused by the heavy vehicles. The fees will be subjected to yearly adjustments based on inflation.

Money generated by the levy will be transferred to the federal road fund and are intended for road maintenance and construction.

Individual truck owners and transport companies will be given free devices, distributed through a network of special-purpose centers to be established across the country, making it possible to track the movement of vehicles along federal roads with the help of the Glonass navigation system, the ministry said in a statement.

Prior to the start of the journey, a truck owner will have to deposit on a special account a sum equal to the charge for the intended distance to be traveled. When the truck starts moving, the money will be gradually deducted and transferred to the federal budget.

A data processing center will be set up and truck movement monitoring systems — both mobile and stationary — will appear to ensure control over violators, the ministry said.

Fines for not paying for the use of roads will range from 5,000 rubles to as much as 450,000 rubles, the statement said.

There is no official information on how many heavy vehicles there are in Russia, but experts estimate that there are about 1.5 million.  About 70 percent of all goods are being carried across the country by vehicular transportation. A 12-ton truck usually has 5 axles or more and is used for large cargo and long distances. Popular manufacturers include MAZ, Volvo, Iveco and Renault.

According to the Transportation ministry, the measure will provide an additional 89 billion rubles in taxes in 2015, with the amount predicted to almost double by 2024.

Experts were skeptical that such a complicated system of levying fees on truck owners would work without malfunctions right from the start.

"It will be difficult for the government to work it out the technology. Maybe it will function from  the second or third try by 2016 or so," Alexei Bezborodov, the head of the Infranews transport research agency, wrote in a comment.

While experts raised some doubts on the technology aspect, truck owners were furious with the whole idea of having to pay for using roads.

"How can we make ends meet in the business if, in addition to the transport tax and the fuel tax, another 400,000 rubles a month is deducted on average per one truck?" said Alexander Kotov, leader of the Professional Drivers labor union.

"Our government says that it supports small and medium business, but it is killing us this way. The measure will make small logistic companies extinct and only large ones will remain," he said.

He also said it was not 12-ton trucks but heavier vehicles that travel without permission that are damaging the roads the most.

"Heavy trucks carrying gravel, lumber, grain, weighing 40 to 50 tons — they are the ones that destroy the roads. Make them pay for that," Kotov said.

Truck fees are actually a two-sided story, said Mikhail Blinkin, head of the Higher School of Economics' Road Research Center.

"On one hand, highway users must pay their way. This is the law of transportation economy, and it works everywhere in the world," he said. "And they pay a lot more in the West than we do here. The form could be different — taxes, special fees for heavy vehicles, toll roads, toll entrances to cities — there are dozens of ways to do it."

Making people pay for using roads has an obvious positive effect as more funds become available for road construction, and a lot of roads in Russia are overdue for repairs, Blinkin said. It also creates a better balance between road and rail transport, with some goods shifting to be transported by rail instead of roads.

But the measure has a negative effect too, he added. "These payments will be passed on as an increase in the price for goods delivered, and that means that we, who buy them, will have that difference included in the bill."

Some drivers actually do not mind paying for using roads but want to see quality for their money.

"But all we hear is another road official who has been caught with a pile of stolen money while the roads are as bad as they were before," Kotov said.

"In foreign practice, the associations of drivers, professionals, labor unions and many others monitor how the roads are being built, and they are the best form of control one can imagine," Blinkin said, adding that the role of similar professional organizations in Russia is minimal.

Meanwhile, the truckers are determined to take serious measures to prevent the fees to be levied on them.

"If they want Turkey here, they will get it. We have over 10,000 active members in the union and only a few trucks are necessary to block a road," Kotov said.