Uber adds gas fee, proposed bill could raise rider sales tax
Rideshare sales tax could go up to 6%
LEXINGTON, Ky. (WTVQ) – Starting Wednesday, it’s going to cost you more to Uber. The company is adding a fee to try to offset high gas prices.
As of February, there were 3,607 active Uber drivers in Kentucky, according to the Kentucky Transportation Cabinet. For drivers like Frank Harris, this is his main source of income.
“On a good week, I’m making between $25 and $35 an hour and it varies that much,” says Harris.
Harris says typically he has to fill his gas tank three times a week. He says he averages about 3 riders an hour, which once the added gas fee is implemented would bring in an extra $1.65 per hour.
“I’d say I probably use, you know, a gallon and a half to two gallons every hour depending on where I’m driving,” says Harris. “So, it’s not really going to offset the higher gas prices, but every little bit helps, I’ll take what I can get.”
The Kentucky house has passed House Bill 8, which would add a 6% sales tax to rideshare programs. The bill now goes to the state senate. House Bill 8 states the tax is the responsibility of the company, however, it can be collected through charging the user. You can read House Bill 8 in full by clicking the link HERE.
Uber says the rider would pay the sales tax, which could increase the average cost by up to two dollars. Uber says the 6% sales tax on rideshares would be one of the highest in the country.
“We understand that we have to pay to the state budget given that drivers are using the road,” says Javi Correoso, spokesperson for Uber. “Our feedback to leaders has been not to eliminate this tax or not for Uber to pay anything, but we just think 6% would be pretty high on the spectrum.”
Harris says about 80% of his riders are people going to or from work and he says a higher sales tax on top of already high gas prices could lead to a lot of people having to tighten their belts.
“It’s going to hurt the working people more than anybody else,” says Harris. “They don’t need to pay more taxes.”