Uber users have probably noticed a bright, blue message at the bottom of their screens this week. The ride share company is warning customers that the price of a trip could go up under a proposed Georgia law.
If passed, House Bill 225 would require consumers to pay state and local sales tax on every ride they take.
“It’s a great business model, but they still need to play by the same rules that everybody else uses,” explained Rep. Jay Powell, R – Camilla.
Powell is the primary sponsor of the legislation, which he said simply clarifies the current law that taxes transportation services. Ride share companies think they are exempt from sales tax, but Powell disagrees.
“In my opinion, it’s already clear that they are subject to the law, but to be extra careful, we are changing the law to say that not only does it apply to the direct provider of the service, i.e. a taxi driver or limousine driver, but it also applies to a facilitator or broker of that service so long as they also accept payment,” Powell said.
Uber, however, calls the measure “a tax hike.”
“This tax is out of step with states across the country and would hurt Georgians who depend on Uber for affordable rides–whether it is home from the bar late at night or commuting to work each morning,” the company wrote in a blog post (https://newsroom.uber.com/us-georgia/tell-the-georgia-legislature-dont-tax-my-ride/) earlier this week.
Many states do not collect sales tax on Uber or Lyft rides, but Powell said that does not matter. He argues the bill is about making sure all ride services are treated the same way under the law in Georgia.
“I took an Uber the other night and it was a limousine. It had a limousine tag on it,” said Rep. Powell. “So, the limousine driver if he takes a call from the limousine service, he has to pay sales tax. If he takes a call from Uber, he does not.”
Powell hopes the full House will vote on the measure before the end of business Friday, which is Crossover Day.