Civic News
Finance / Municipal government / Transportation

DC Council passes higher increase in ridesharing taxes than Bowser proposed

It's part of a series of tax hikes to pay for Metro. The Council's final 6-percent increase on gross receipts tax drew a rebuke from services like Uber and Lyft.

Where to? (Photo courtesy of Uber)

The D.C. Council gave initial approval to a budget that includes a tax increase on rides through services like Uber and Lyft.

Mayor Muriel Bowser initially proposed a gross receipts tax increase on the ridesharing services that would be passed on to riders earlier this year as part of a package of increases to provide funding for Metro.

According to WAMU, the 6 percent increase passed by the Council would translate to additional 60 cents for a $10 ride.

The Council’s hike is higher than the 4.75-percent increase initially proposed by the Bowser administration.

Ridesharing companies opposed the move, with an Uber spokesman telling WAMU it was “devised behind closed doors without public input.”

Lyft Communications Manager Campbell Matthews said the company supported a proposal to maintain current tax levels for shared rides, but raise the gross receipts tax only on single-occupancy rides. But the company opposed the Council’s final billWhile we support efforts to improve DC’s transit system, saying it supports transit but wants to keep ridesharing affordable, “particularly those who may live further from transit or need rides when public transit doesn’t operate.”

“For the City Council to attempt to raise taxes on all rides – across the board – to a staggering 6 [percent] is highly disappointing, and unfair to DC’s rideshare passengers,” said Lyft Communications Manager Campbell Matthews said in a statement. “We are hopeful that lawmakers realize the importance of keeping transportation affordable and accessible for those who need these rides most.”

Overall, the proposal is designed to create a dedicated funding source for Metro. As part of a regional agreement with Maryland and Virginia, D.C. is set to contribute $178.5 million a year. Other tax increases include .25 increases in the District’s general sales tax and a tax on alcohol bought at liquor stores, as well as a .15 percent increase on the hotel sales tax.

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