Sharing economy targeted for additional taxes
The US state of New York is imposing a 2% tax on platforms facilitating peer-to-peer ride sharing. The tax will be levied on the gross fee for the ride share. This will become effective from 22 March 2022.
Platforms will be obliged to file quarterly returns indicating: number of journeys; gross charge per journey; and levy charged. The submission and levy payment would be due by the 30th day after the quarter end.
In addition, there is a 2% Metro District levy on gross ride-sharing fees for the driver to charge. Plus a separate 2% Regional Transportation Levy, again for the driver – which rises to 3% from January 2023.
Global evaluation of role of platforms and VAT / GST collections
India has just levied 5% GST on ride sharing and deliver platforms. The EU is also reviewing VAT treatment for the platform economy, which includes the gig and sharing economies. And the DAC 7 EU marketplace reporting requirements come into effect on 1 January 2023. A UK VAT on gig and sharing economies review is also now underway. Reach about the attractions and challenges of making marketplaces responsible for VAT collections in the form of withholding taxes or as the VAT principal.