Backstory (Thom Hatmann tagged)
Rahm Emanuel's pitch that his family business, Uber, would generate millions in additional revenue for the city. The city council killed the mayor's first two budget proposals opening the airports to Uber, but he managed to get it approved on his third attempt when it was passed because he was holding other funding hostage. That was how pre-video tape Mayor 1% used to roll: nothing was negotiable for the Mayor of the multi-millionaire and billionaire class.
When the ordinance passed in late October, the airports were to be given time to figure out the logistics, in particular, how would the airports collect the big revenue generating $4 airport departure tax; would the airports collect it like they do from taxis (how would they do that?) or would they rely on Uber to collect it then reimburse the amounts owed? Who knows? But Mayor 1% played his hand and rushed to open the airports ASAP. Good for the family business and its multi-millionaire and billionaire investors like Jeff Bezos and brother Ari Emanuel; lower fares is a competitive advantage. "Technology provides a competitive advantage" is a sexy meme, but its real competitive advantage is tax avoidance. The Uber tech bros aren't all that clever as portrayed in the media, they've simply built on the Libertaian business models before them. Jeff Bezos took advantage of an obscure ruling that made internet sales exempt from taxes. Uber then structured its business on the Wal-Mart model: avoid employer taxes by claiming you're not an employer. And finally, hide all of your revenue in tax free, off shore tax havens in the Netherlands and Bahamas. Amazon, Wal-Mart, Uber -- they're all job killing, tax payer subsidized behemoths and media darlings.
"Two local tourism agencies and a northwest suburb filed suit Friday against Uber and Lyft, claiming the ride-hailing services have refused to pay a tax imposed on all persons providing transportation from O’Hare and Midway airports.
The Metropolitan Pier and Exposition Authority, commonly known as McPier, along with the Choose Chicago, the city’s tourism bureau, and the village of Rosemont filed the lawsuit, claiming the ride-hailing companies have neither collected nor paid the fee, called the Airport Departure Tax, since the city allowed them to pickup passengers at the airports in November 2015.
ax pays for McPier’s capital improvement projects and funds Choose Chicago and the maintenance and improvement of the Donald E. Stephen Convention Center, according to the lawsuit. McPier manages McCormick Place convention center and Navy Pier.
McPier is allowed to impose the tax “on all persons, other than a governmental agency, engaged in the business of ground transportation for hire to passengers in the metropolitan area at a rate of $4 per [vehicle]…from commercial service airports in the metropolitan area,” the suit said.
On Jan. 7, McPier notified Uber and Lyft of their obligation to pay the tax, no payments have been received, according to the lawsuit.
The Chicago-Sun Times has reported that Uber and Lyft owe Chicago taxpayers $15 million in unpaid parking tickets, red-light and speed camera fines and overdue water bills, which has fueled demands for them to get chauffeur’s licenses.
Ald. Anthony Beale also alleged that Uber and Lyft owed “millions” more because they’re not collecting the $4-a-ride departure tax, the Sun-Times reported.
“If any company owed that kind of money to the city of Chicago, they could not renew their license,” Beale said at the time.
In response to the lawsuit, spokeswomen for Uber and Lyft both said MPEA does not have the authority to levy the tax since their drivers are not operating for-hire vehicles like taxis and liveries. They also said the $4-a-ride tax, if imposed, would be passed on to consumers.
Besides the unpaid taxes, the lawsuit asks for interest and penalties."
http://chicago.suntimes.com/news/uber-lyft-sued-mcpier-others-say-taxes-owed-on-airport-pickups/