Taxi drivers rally against so-called 'taxi tax' at capitol

Tax drivers gather in protest of the proposed tax hike on taxis and other transportation services outside the capitol Monday. (Photo: Caroline Cummings)

Local tax drivers gathered outside the statehouse Monday to rally against tax hike on taxis, ride sharing apps like Uber and other transportation services proposed in tax plans at the capitol.

Lawmakers in the Republican-led House and Senate are at odds over what to do about tax reform, proposing different plans late last week as the end of session looms. Both proposals include a tax on transportation services. Governor Reynolds' plan also includes this provision.

On Monday, taxi drivers parked their tax cabs outside of the Iowa State Capitol and spoke out against this proposed sales and use tax on transportation services because it would result in higher fares for riders, many of whom lower income Iowans that will be hurt by the proposal, protesters argue.

“I think the folks at the Statehouse feel that tax rides who are going out on Saturday night drinking or going to the airport. It’s not a luxury item for everybody it’s a necessity. We’re a public necessity," assailed Scott Karnowski, a taxi driver with YellowCabCo., a subset of Trans Iowa, a Central Iowa transportation company.

"We’re not limousines. People are using our services to get to work, school, to doctors’ offices and grocery stores," Karnowski said. "[The proposed tax] needs to go because the poor can't afford it."

Supporters say the proposed tax increases evens the playing field since limousine services are already taxed under current law. They also contend the taxes are keeping up with the "modern economy," especially those waged against ride sharing apps like Uber and Lyft and subscription services like Hulu and Netflix, which will also face a sales tax hike under the tax reform plans circling the capitol.

"We've seen sales tax and use tax remain stagnant and continue to decline so I don't think it's unrealistic to modernize the tax code," Governor Kim Reynolds told reporters at her weekly press conference Monday.

Tuesday marks the 100th day of session, which is the last day lawmakers get paid under law. With tax reform and budget bills still on the table, all signs point to staying in Des Moines longer on their own dime as they work out the details and wrap up business in the legislature.

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