PHOENIX – The Phoenix City Council voted on Wednesday to raise taxes on ridesharing companies providing trips to and from Phoenix Sky Harbor Airport. The 7-2 vote increases the tax from $2.66 per pickup to $4 starting January 1.
The tax will increase to $4.25 in 2021, $4.50 in 2022, $4.75 in 2023 and $5 in 2024.
Officials with ridesharing companies, Uber and Lyft contacted officials with the City of Phoenix to advise them that if a tax increase were to be approved by the City Council, the company would be forced to no longer offer services to and from Phoenix Sky Harbor Airport effective January 2020.
Related article: Uber To Cancel Service At Sky Harbor Should Phoenix City Council Pass $5 Tax
Phoenix City Councilman Sal DiCiccio called the tax “unconstitutional.”
Earlier this month, the Goldwater Institute sent a letter to the Phoenix City Council and Mayor Kate Gallego informing them that the tax increase would violate Arizona’s Constitution. According to the Goldwater Institute, “In 2018, Arizona voters overwhelmingly passed Prop 126, which prohibits cities from adding or increasing any new tax or fee on services provided in Arizona. Under Prop 126, both the addition of a new drop-off fee at Sky Harbor and the increase in the fee to be picked up there, are impermissible.”
The Goldwater Institute warned the City Council that if it were to approve the “exorbitant fee, they will open the City up to litigation for this unconstitutional action.”