Certain types of medium and heavy tactical wheeled vehicles purchased or refurbished by the U.S. Department of Defense (DoD) are subject to a 12-percent Federal Retail Excise Tax (FRET) on the retail price or refurbishment cost of the vehicle. Original equipment manufacturers (OEMs) pay FRET, but are reimbursed for these payments by DoD. FRET proceeds are provided to the Highway Trust Fund (HTF).
Edward G. Keating,Chad Pino,Sarah H. Bana. Understanding and Assessing the Costs of the Federal Retail Excise Tax on the Department of Defense. 2016-01-01.