Transportation

Politics outranks good policy

In late 2018, Postmedia reported Andrew Wilkinson’s lament about the Horgan Government “creating unnecessary complications” for ride hailing providers.

In 16 years, Liberals demonstrated they are OK with “cumbersome government-run bureaucracies” that collect income, sales and other taxes from citizens. But they want easier treatment of foreign corporations that cause increased traffic congestion.

According to Bloomberg, these transportation network companies facilitate tax avoidance as well. Yet, their revenue generation depends on use of bridges and roads and traffic management funded by taxpayers.

People associated with Uber and Lyft have taken advantage of measures designed for small business to partially or totally wipe out tax bills. As it is with many such tax arrangements, the vast majority of small businesses are ineligible for these profitable breaks:

Early investors and employees at Uber Technologies Inc., Lyft Inc., and other tech companies are getting a double reward this year: a wave of initial public offerings that puts billions of dollars in their pockets, and a quirk in the law that means some of that money will be tax-free…

“There is no evidence that these sorts of breaks do anything to help the economy in the long run,” says Steve Wamhoff, director of federal tax policy at the left-leaning Institute on Taxation and Economic Policy. “Even in the short run, they are likely to reward investments that would have happened anyway.”

In another story, Bloomberg reports:

Uber Technologies Inc., responding to a European crackdown on offshore tax havens, created a $6.1 billion Dutch tax deduction that will help the company reduce a chunk of its global tax bill for years to come...

“It’s safe to say that Uber will not be paying any taxes for the foreseeable future,” said Robert Willens, an independent tax and accounting expert in New York.

I understand the desire of consumers for improved passenger vehicle service but wonder why the obvious solution is eliminated. That is to greatly increase the number of taxi licenses and ensure free competition in the marketplace.

After banking large contributions from taxi owners while governing, BC Liberals declined to change provincial rules to allow ride hailing. They also failed to ensure adequate expansion of fleets. Decades of government protection resulted in the value of a Vancouver taxi license being worth up to $1 million.

Now in opposition, Wilkinson’s Liberals, supported by BC Greens, are keen to open the market to Uber and Lyft. In my view, the non-governing parties are mistaken.

In most cases, facilitating the gig economy is not good public policy. Opening doors to Uber and Lyft means traffic congestion will worsen, transit use will lessen, large sums will flow to overseas tax havens, and government revenues will reduce.


Categories: Transportation

17 replies »

  1. I don’t understand why the Greens are supporting Uber and Lyft. I get the StreetsblogUSA newsletter and it regulary has links to articles that state ride sharing increases congestion and pollution.

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  2. It could be that the Greens may be your next Uber/Lyft driver as Horgan took them for a ride. Uber and Lyft drivers are going broke in California. Many have found it necessary to sleep in their cars. They also have to pay for gas, insurance and maintenance on their vehicles on a less than minimum pay scale. Who pays for the clean up if a passenger vomits all over the backseat?
    Without regulations and proper screening controls you could have a driver out on a day pass (parole) driving your loved ones. What are your wife and kids worth to you? There have been several Uber drivers charged with rape in the US.
    They have also convicted some other casual Uber drivers for “theft + break and enter”.
    They know where you live and when you will likely be returning. You may not have the Uber driver you thought. Ask to see the driver’s ID before you climb into the backseat.
    How do you sue an uninsured Uber driver that may not have a licence or no fixed address? Does the driver suffer from road rage or anger management?
    At least with a qualified licensed taxi driver there is a chance of suing the Taxi company if the driver puts you in a wheelchair for life.

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  3. Wow Art, have you ever used Uber? I’ve used them in New York, Washington and Puerto Vallarta and never had anything thing great service at a fair rate.

    Norm, to your article, I live in South Surrey, a 10 minute drive to the restaurants at White Rock Beach. If I want to go for dinner and a couple of glasses of wine it costs me $20 each way for a Taxi. There is no public transportation. So, the cost is prohibitive even if I want to wait 20-30 minutes for a taxi.

    The government takes a year plus to ‘study’ ride share programs and finally approves the business model. But wait, the government sets minimum charges to be fair to taxis. Unbelievable!

    I fully understand that the taxi companies want a level playing field but they might have well just allowed more taxi companies with a license fee of a million bucks. I get that that Taxi companies feel raped by Government but but how does applying the same fees/regulations provide affordable choices for the public. What a sham!

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    • I understand the need for change in ways service has been delivered, which is why the article argues for the need “to increase the number of taxi licenses and ensure free competition in the marketplace.”

      In 2017, wife and I were in Madrid and we left the car parked for the duration of our visit. Taxis were readily available and we never waited more than a few minutes. Low costs made them attractive. If Madrid’s cab service rated a ten, Vancouver’s would rate a three.

      There has been a tight circle of people controlling the taxi industry in Metro Vancouver and government policies have ensured that situation continued for decades.

      Twenty years from now, I expect driverless shuttles will move people to mass transit stations and cars will become less necessary in urban areas. Although, I remember one weekend where daughter’s Ringette team was playing in Squamish while her brother’s hockey team was in Abbotsford. Hauling acrid sports bags, sticks and goalie gear on transit didn’t seem to be an option.

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  4. Hi Norm.
    As an employee working in downtown Van who regularly commuted to the surburbs for over 30 years..I have to say.
    I loathed the taxi “service” provided by the major players in the taxi industry.

    A typical Friday evening with drinks with co workers would result in a cab ride home.
    IF a taxi would drive you…..
    The “Balkanization” of the taxi industry ( A Vancouver cab can drive you to the suburbs but MUST drive back empty as they cannot pick up a fare in another city)
    A ridiculous, outdated licensing system THAT THE TAXI INDUSTRY SUPPORTED.
    Vancouver licenses were selling for a cool million.
    Burnaby licenses, about 650k and down from there it went.

    But any time the BC Govt ( Liberal OR NDP) even mentioned “fiddling” with the “License Golden Goose”…. out came the protesters .
    The govts last solution was laughable.
    Announcing 1000 new cab licenses for THE ENTIRE PROVINCE because …..apparently….. Spuzzum ….and….. Ft St John were bereft of taxis.

    The Taxi coalition was satisfied. It’s predictable campaign contributions to both major parties produced the desired results…( it never ceases to amaze that an elected official will sell their constituents down the road for a few hundred thousand $$$$. worth of posters).

    The taxi cash cow in Vancouver was still safe.
    Even as the demands for fixing a dreadful, grossly understaffed taxi system reached a fever pitch in the Lower Mainland.

    “Dont drink and drive” (but you better be home before Skytrain shuts down at 1am).

    So….. as technology and the fed up consumer have proven.
    Either embrace technology or be (literally) run over by it.

    Uber will be around until driver less cars .are a proven technology (5 years …maybe 10?) as I suggested to a horrified, unprepared, arguementative, ostrich-like taxi driver a year or so ago

    One wonders when all the human taxi drivers are gone (like BlockBuster Video?)
    Who will then shovel money to the undeserving , elected hacks that infest every level of govt..

    Either way. the taxi driver and their self serving politicians deserve a special type of Hell where the cabs are full of elected officials , the windows dont roll down, the Air Conditioning doesnt work, the insolent cab driver prattles non stop loudly into his cell phone ….all while the taxi cant find the address and the meter never shuts off…….

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  5. Ride-hailing companies would not have been envisioned, let alone been successful unless there was a void to be filled. That void represented what the public wanted versus what the taxi companies and public transit offered.
    As soon as technology allowed it, taxi firms could have precluded formation of that void. They didn’t, and are now playing catch-up to survive:
    https://www.wired.co.uk/article/london-minicabs-taxis-uber-igo-merger

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  6. Uber and Lyft make money by skirting regulations and not paying their fair share of taxes.

    There was a lot of complaint by the professional “booster class”, that so infects our local media reporting, the Uber and Lyft drivers needed a Calss 4 license.

    Why the hell not, If you are carrying people for money, then you should have a class 4 license, just as the taxi companies.

    What we see is nothing more than a corporate scam undercutting the competition pretending they are something when they are not, if you carry people for money, you are a taxi and should abide by the rules and regulations covering the conveyance of people on the public highways.

    The trucking industry have long pulled the same scam by undercutting the railway rates by paying substandard wages and using the public highways without paying their share to do so. The taxpayer greatly subsidizes the trucking industry in BC.

    As for driverless shuttles, I think not, they may work in strictly controlled tests but in general use, no. There are too many variables to contend with. But what make a change is the driverless tram, being developed and used in select cities, where if their is a problem the on board attendant can easily take manual control and being a tram operating on tracks, the vehicle cannot skew out of its lane-way, unlike driverless buses, thus do not pose a danger, especially at high speed.

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  7. Well saying the Taxi industry had this coming is an understatement. The BC Liberals had 5 years to bring in ridesharing and i think they threatened to throw people in jail if they tried to. But then they lost those special Surrey riding’s and bing, bing ,bing ….opinions change. The best part of the “ride sharing ” economy is that Uber and Lyft take a cut of everyone’s pie and they are using that cut to develop driverless cars ensuring that their last cut will be to all the dummies that bought into yet another big business ponzi scheme. At this point i think we are just rearranging the deck chairs everyone, this lifeboat we call earth is sliding into the blackness as we prattle on.

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  8. for most of our lives we are taught never to get into a vehicle with a stranger and now we have companies who not only encourage it, but are set to make a mint out of doing so. These drives don’t make a lot of money, but the corporations will. In my opinion its simply another corporate run at avoiding taxes, etc. There is also the no small matter of the mechanical condition of the vehicle. .

    I’ll stick with a taxi, even if they are more expensive. Mom always taught us you get what you pay for.

    it is in Loft and Uber, etc. interests to keep negative stories out of the press and the number of cases given of sexual assault, I’d suggest is low. I can hardly wait until the Human Rights Commission starts receiving complaints for those who don’t want to provide services based on race, sexual orientation, ethnic back ground, yikes.

    The B.C. Lieberals ought to have simply doubled the number of taxi licenses in this province and we could have avoided all of this mess.

    If people don’t want to drive drunk, here’s a suggestion: don’t drink so much. Nothing says you have to drink more than a glass of wine.

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    • Yes you’re right. Why did the Liberals and now the NDP not just allow way more licences for the existing taxi industry but with existing problems ironed out and maybe with beteer regulations if needed. No refusing to take customers to certain distances in the lower mainland. Regulate for more fair rates if necessary and so on. So much Media meatheads won’t discuss any of it. They stay in their little narrow tunnel and the build up and sensationalize the Uber and Lift stories for the days discussion. They whip up a public frenzy to buy in to these alternatives that may not be so good. And then whala, government follows the frenzy that works for them like little rear kissers. It makes for excitement on the radiowaves or columns etc. Bowel of Bias Cereal anyone. They are completely useless and brain dead otherwise. That’s my sentiments about it.

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  9. It will be interesting when the next Federal/Provincial Governments decree that all vehicles for hire must be electric. Most of the 4th class licences will worthless but the government will have made millions. Try and sell your gas guzzling vehicle .it will be heading for the scrap yard. .. the Province will also lose out on millions from the used vehicle transfer tax.
    The electric vehicles will not be paying the gas tax, Transit shortages or Translink taxes at the pump. The roads will still need pothole repairs and it will be an increase in municipal property taxes that will pay the costs. Owning a second house as a retirement investment in B.C. will be a bad investment.
    Then, where are the rapid-charge plug ins going to be? Electric batteries are heavy and have a shelf life of 5-8 years. What affect will it have on outdated Billion dollar Smart Meters that require upgrades, replacement and built in obsolescence ? The BC Utilities Commission will allow another “unforeseen expense” and will allow an immediate 10% hydro rate hike. The rubber stamp might be the only rubber that hits the road.
    Taxpayers will once again be taken for a ride.

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    • That ride is called “Road Pricing”, coming to the taxpayers sooner than one would think.The insatiable quest for more and more money by government is almost overwhelming.

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      • I’m tired of the seemingly prevailing ethos that government takes more and more money from earners’ pockets and does nothing with it. Taxes are the price we pay for civilization!

        1) I left BC in 2002. Returned in 2007. I was STUNNED by the number of people living on the street when I returned.

        2) What sort of society do you want? A compassionate one? Or a ‘devil-take-the-hindmost’ one? A compassionate one cost money. Do you really think that the $200 a year you’ll save if taxes aren’t increased will markedly improve your standard of living?

        3) What if we don’t help the disadvantaged? I am familiar with some of those people. They can’t even keep track of their room key despite only having one or two keys two keep track of! Not helping them has already been tried in the 1930s and 1940s. The world decided that the proposed solution was immoral. Are you going to kill all those people who cannot keep a job? Who can’t keep a living space? If you are – YOU SHOULD DO THAT PERSONALLY.

        4) More equal societies are safer societies. For everyone, including the wealthy. Read some of the literature (AKA studies) if you doubt that.

        5) Humans are tribal animals. Their societies work best when they are structured as a tribe of about 200 persons or less – and they work VERY WELL if structured that way. Better than any other human societal structure studies.

        But what do you care, you greedy pigs? It’s all “I I, Me Me, Mine” for you, isn’t it? (https://www.youtube.com/watch?v=seqaTuXkqFI)

        God I hat human beings sometimes.

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