Ride-hailing fee passes Georgia Senate after winding road
ATLANTA — A proposed fee for bookings of ridehailing services like Uber and Lyft cleared the Georgia Senate Wednesday, March 4, on the promise that revenues from the new charge would go entirely to fixing the state’s roads and public transit systems.
The path to imposing a flat fee instead of state sales taxes on Uber and Lyft has wound through two legislative sessions, lobbyist pushback and Hurricane Michael.
Originally, House Bill 105 by Rep. Sam Watson, R-Moultrie, only involved an income-tax exemption for farmers receiving federal disaster aid payments to recover from Hurricane Michael, which pummeled the heart of Georgia’s agriculture industry in late 2018.
But last week (Feb. 23-29), Senate lawmakers tacked on an amendment to Watson’s bill that proposes charging a 50-cent fee for ride-share bookings for single passengers. The fee would be 25 cents for multiple passengers.
With the fee, ride-share companies like Uber and Lyft, plus taxi and limousine companies, would not have to pay state sales tax.
Representatives for San Francisco-based Uber favor paying the fee over sales taxes, arguing a tax levy would drive up costs for riders and drivers.
Revenues from the fee would be dedicated to transportation and transit infrastructure projects in the state, said Sen. Steve Gooch, who spearheaded the amendment.
“We believe that this revenue is important for transportation,” said Gooch, R-Dahlonega.
If signed into law, the fee could drum up between $24 million and $45 million for the state in its first full year in effect, according to a fiscal note. County and city governments, which would not benefit from the fee, would lose out on between $16 million and $26 million the first year.
The heavily revised bill passed the Senate by a 51-2 vote, with Sens. Renee Unterman and Greg Dolezal voting against it. It now heads back to the House, which could give it final passage.
But even more legislative maneuvering is needed first before money from the fee could go exclusively to transportation and transit.
State law requires that any proposals to dedicate tax revenue to a specific purpose gain voter approval via a constitutional amendment, which first needs to pass the legislature by a two-thirds vote.
A proposed constitutional amendment was tucked in Tuesday, March 3, to an entirely separate measure, House Bill 164, dealing with fees raised from scrapping old tires. With this proposal, the General Assembly is angling to expand its ability to dedicate sales taxes for specific purposes, said Senate Finance Committee Chairman Chuck Hufstetler.
“Anything that the legislature would want to dedicate in the future, they could do that,” Hufstetler said Wednesday, March 4.
Wednesday’s (March 4) vote in the Senate stems from earlier efforts to collect sales taxes on thirdparty retailers like Amazon and Google that facilitate online transactions for other businesses.
House and Senate lawmakers hashed out a compromise for those so-called “marketplace facilitators” in January after pledging to give Uber an exemption in separate legislation.
A similar 50-cent fee on Uber and Lyft rides had previously been slated for inclusion in a measure sponsored by Rep. Kevin Tanner, R-Dawsonville, that seeks to raise more funding for rural transit services.
Last week (Feb. 23-29), state officials announced farmers in the southern part of the state could start applying next month to receive Hurricane Michael recovery funds part of a $347 million federal aid package.