How Prop L Funds Muni Service
Aligning San Francisco’s ride-tail taxes with other cities
Prop L raises $25 million a year in critical funding for Muni service by adding a 1.5% – 4.5% business tax on ride-hail companies (like Uber) and robotaxi companies (like Waymo). San Francisco currently taxes ride-hail at lower rates than other major cities—and with Prop L, our tax rate would still be lower than in Manhattan, Chicago, and D.C. for a $10 ride.
As ride-hail has been shown to increase congestion and replace more sustainable kinds of trips, taxing ride-hail to fund public transit is a common-sense policy. Prop L only taxes the revenue these companies generate from rides in San Francisco. Because Prop L does not tax payroll, it does not incentivize ride-hail companies to move their offices out of San Francisco. Prop L also does not tax other activities from these companies, like food delivery or bikeshare.
Details and Citations
The chart above shows San Francisco’s current ride-hail taxes on a $10 fare compared to other major cities that have added ride-hail taxes, and how these taxes would change with Prop L. Note that the chart does not include general city business taxes or state-level taxes.
New York City
Rides are subject to local sales tax including a 4.5% New York City sales tax and a 0.375% Metropolitan Commuter Transportation District surcharge. Rides that start, end, or pass through Manhattan are also subject to a $2.75 congestion charge.
Washington, D.C.
Washington, D.C. imposes a gross receipts tax (business tax) of 6% on ride-hail companies as well as a congestion management surcharge of $0.25 per trip ($0.15 per trip for hybrid vehicles and $0.10 for zero emissions vehicles).
Chicago
Chicago charges a congestion surcharge at a rate of $1.25 per trip. For trips that start or end in the downtown area between 6am and 10am on weekdays, the surcharge rate is increased to $3.00.
Portland
Portland imposes two per-trip fees on ride-hail: a $0.65-per-trip base fee and a $0.11-per-trip fee for the Accessible Service Fund, for a total fee of $0.76 per trip.
Seattle
Seattle charges ride-hail companies a business tax of $0.42 per trip.
San Francisco
San Francisco currently taxes ride-hail companies at a rate of 3.25% on the fare of each ride.