A new version of a bill proposed by Rep. Kevin Tanner, R–Dawsonville, would exempt ride-sharing companies from collecting sales and use taxes for their services.
Instead, House Bill 511 would impose up to a 50-cent excise tax on ride-sharing, taxi and limousine trips. If the bill becomes law, Tanner's aim is for it to replace the marketplace facilitator tax scheduled to take effect April 1.
Tanner outlined the details of HB 511 in front of the Senate Transportation Committee on Tuesday. Tanner, who chairs the House Transportation Committee, said he has worked with representatives from ride-sharing company Uber for three years to establish the agreement. The revenue from the tax would be used to fund pilot programs to help people get transportation to rural and poorer communities.
“I believe it is something that they would testify that they support,” Tanner said.
HB 511, which was shot down last legislative session in the Senate, focuses on creating initiatives to improve transportation options for the less fortunate areas of the state. It would create a sector in the Georgia Department of Transportation dedicated to empowering local governments to raise sales taxes for transit improvement.
Tanner’s new provision adds a 50-cent excise tax on every for-hire trip and a 25-cent excise tax for trips that are shared with other passengers.
As a web-based business that provides service in the state, ride-sharing companies such as Uber and Lyft are considered marketplace facilitators. Gov. Brian Kemp signed House Bill 276 on Jan. 30. It requires a remote company to collect sales taxes and remit them to the state if its total sales the previous year were $100,000 or more.
The difference in revenue collection boils down to a flat-fee versus a spending-based tax. The excise tax imposed on passengers would cost less for riders, but the marketplace facilitator law would mean more revenue for the state.
A spokeswoman for Lyft said that the company is encouraged that alternative legislation is being considered.
"An 8.9 percent tax, as passed in HB 276, is one of the highest rideshare taxes in the country and will hurt those who rely on Lyft for rides to work, doctor's appointments, and the grocery store, as well as an alternative to driving after drinking," she said. "We are hopeful that Georgia's legislature will find a better solution for riders and drivers."
Georgia State University's Fiscal Research Center estimated the marketplace facilitator law could bring in $76.5 million to $85.9 million in additional state revenue within the first fiscal year.