The Georgia Senate push forward a bill Wednesday that would add a flat-fee tax for ride-sharing trips instead of sales tax.
Language added to House Bill 105 would require riders to pay 50 cents a ride-share trip or 25 cents a pool ride in place of an 8.9 percent sales tax. The bill’s original language would exempt disaster relief aid from being subject to income tax.
Senate Majority Leader Mike Dugan, R-Carrollton, asked his colleagues on the Senate floor Wednesday to not let the new language get in the way of the bill’s original purpose.
“After Hurricane Michael, [farmers have] gotten the support to get them back on their feet to kind of continue to promote the No.1 industry within the state of Georgia,” he said. “And what you don’t want to do is punish them further by not passing this bill, or by complicating it to the point that it is not passable.”
The Senate voted 51-2 in favor of HB 105, but the new version of the bill will have to be approved by the House.
The move to add the ride share flat fee is a response to House Bill 276, which is slated to take effect April 1. The new law is aimed at collecting tax revenue from businesses that provide services or sell products remotely in the state.
Watson’s attempt to push forward the ride share flat fee is the second attempt by lawmakers to do so in the past month.
On Feb. 5, House Transportation Committee Chairman Kevin Tanner, R–Dawsonville, proposed adding the fee to another unrelated bill he sponsored last legislative session, House Bill 511, which creates a plan to finance transit expansions in rural Georgia. No further action has been taken on the bill since then.
The new language in HB 105 would require the taxes collected on the rides to be used solely for transportation, capital improvement and infrastructure projects.
Georgia State University’s Fiscal Research Center estimated the ride share flat fee could generate $4.4 million to $13 million more in state revenue in 2021, but local revenue could decrease by $16.3 million to $26 million as a result of losing sales tax on the rides.
The additional sales tax by way of HB 276 was projected to accumulate $78.4 million in state revenue and $64.5 million in local government revenue within the same timeframe. Those estimates would decrease by the ride-share estimates should HB 105 become law.
However, Watson and the others argue that the ground transportation services help reduce the number of vehicles on the road and improves the air quality of the state.
