Uber Canada is urging the federal government to change its mind over a proposal to change GST/HST on ride-hailing fares. Finance Minister Bill Morneau introduced the plan during the 2017 Budget this week.
An Uber Canada spokesperson called the proposal a “tax on innovation” and said the government should reconsider and help customers:
“At a time when Canadians spend far too much time stuck in traffic — and people should be encouraged to leave their cars at home, take public transit, and share rides — we should be supporting policies that make sustainable transportation more affordable, not more expensive,” said Ian Black, regional general manager for Uber Canada, in a statement.
Under the proposed tax, ride-sharing companies like Uber would need to place GST/HST charges on top of fares, making journeys more expensive. The traditional taxi industry already implements these charges. This would be a coup for cabbies who have often argued government has been too lenient with Uber and does not treat taxi companies and ride-sharing equally.
Morneau’s plan will be put in effect from July 1, 2017. The government admits it has created the tax to bring fairness to the market, with the extra revenue only amounting to $3 million during 2017-2018.
“Federal tax laws already offer small business owners a break on collecting sales tax, but unfairly exclude taxi drivers,” Black said. “The best way to support taxi drivers and level the playing field is to extend the same exemption to them.”