Sunday August 21, 2016

Massachusetts Will Tax Ridesharing Services To Compensate Taxis

Every Lyft or Uber you hail in MA will directly fund the taxis they're competing against. While the money is supposed to improve taxi services, I wouldn’t count on that happening. This development, of course, also makes it harder for ridesharing startups to succeed.

The law levies a 20-cent fee in all, with 5 cents for taxis, 10 cents going to cities and towns and the final 5 cents designated for a state transportation fund. The fee may raise millions of dollars a year because Lyft and Uber alone have a combined 2.5 million rides per month in Massachusetts. The law says the money will help taxi businesses to adopt "new technologies and advanced service, safety and operational capabilities" and to support workforce development. Regulations for how the fee will be collected and a plan for how it will be spent still need to be drawn up, said Mark Sternman, a spokesman for the state's MassDevelopment agency, which will be in charge of the money.