Transportation Commerce Taxes have begun
- July 3, 2025
- Posted by: Joe Milazzo II
- Category: Blog
RTA members,
This week marked the beginning of a new month, and the start of the second half of the calendar year.
July 1st also marked the start of a new state fiscal year, and this year that includes the initiation of a new tax on taxis and rideshare companies (e.g., Uber, Lyft).
A North Carolina “transportation commerce tax” went into effect on Tuesday, July 1st for travel on taxis and rideshare companies such as Uber and Lyft. Passengers now pay an extra 1.5% of their fare for an exclusive ride, and 1% for a shared ride with other travelers. Note that if you tip the driver, the tip is not subject to the tax, since it is a voluntary payment, as long as the entire amount was provided to the driver and the Provider company keeps appropriate records (ref 1).
The expectation is that this will generate around $11 million in the state Highway Fund this fiscal year, ending June 30, 2026.
This recommendation came out of the NC TEN Commission, led by Senator Vickie Sawyer of Iredell County. I served on that stakeholder group in 2022. Legislation was enacted in 2023 as part of the budget bill and went into effect on July 1, 2025. The general statute is 105-187.91,
Here is information from the NC Department of Revenue (ref 1, ref 2).
Here are two media stories in the Raleigh News&Observer: one from 2023, after the legislation was enacted, and a recent one with an associated video from the NC Department of Revenue.
Joe
