The WasteWatcher: The Staff Blog of Citizens Against Government Waste

Reduce Regulatory Burdens Instead of Increasing Fees

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


Innovative technology has become the foundation for performing mundane tasks, such as vacationing, buying groceries, and even catching a ride, in new inventive ways.  The sharing economy is on the cusp of such a revolution, using mobile apps to offer consumers new ways to connect with the services they want to use.  However, as noted in a June 2016 WasteWatcher article by Citizens Against Government Waste’s State Policy and Government Affairs Manager Andrew Nehring, ride-sharing has come under increased fire.

In his article, Nehring highlighted the ongoing struggle for ride-sharing companies like Uber and Lyft to gain entrance into the Austin, Texas market.  Austin is not alone in trying to regulate this industry.  On August 5, 2016, Massachusetts Governor Charlie Baker signed a bill into law that would require ride-sharing companies to pay a 20 percent surcharge for each ride generated in the commonwealth.  Of the 20 percent surcharge, 5 percent of the proceeds will be used to subsidize taxi and livery services.  The remaining 15 percent is expected to be used to provide municipal and state transportation infrastructure improvements.  Instead of creating an equitable regulatory status between the traditional taxi and livery services and the newer ride-sharing services, the law forces one sector of the industry to subsidize the other. 

Rather than making it harder for new entrants in ground transportation options to compete by forcing ride-sharing companies to subsidize the taxi industry through increased fees and surcharges, states should refocus their sight on the burdensome regulations as a whole, and consider ways to level the playing field by reducing these burdens.  

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