Uber and the taxi industry agree on one thing: they both hate the Victorian government's new $2 levy

Sept 10, 2015 – Taxi drivers are walking off the job in protest of then-illegal rideshare service UberX. Photo by Robert Prezioso/Getty Images)

The Victorian state government last week proposed to regulate Uber and compensate taxi licence holders with a new $2 levy on each trip in a cab or a rideshare car.

But Uber is not happy, responding by sending out emails to Victorian customers to urge them to sign a petition against the levy.

“The state government is imposing a new $2 tax on every Uber and taxi trip,” said Uber’s Victoria general manager Matt Denman in an email seen by Business Insider.

“It will be the highest tax of its kind in Australia. If you think this is unfair, take 10 seconds to tell Premier Daniel Andrews to scrap this tax,” he said.

The $2 tax has been proposed as a way to raise funds for a $494 million assistance package to compensate taxi and hire car licence holders that have seen their investments plummet in value due to increased competition from Uber.

The trouble is, the taxi industry is also against the fee.

“The taxi industry simply doesn’t support taxi customers having to pay an extra $2 per trip to pay for the Victorian government’s policy debacle,” Australian Taxi Industry Association chief Blair Davies told Business Insider.

“Taxi customers didn’t have any hand in the making of the problem. They also don’t get any benefit whatsoever from Uber being able to make millions of dollars in commissions on UberX trips in Melbourne.”

The state government should source the assistance funding by other means, said Blair.

“We would say a good place to start would be getting the [beneficiaries] of the government’s decisions, like Uber, to make some serious contributions.”

Victoria public transport minister Jacinta Allan said that each transport provider had a choice as to slug passengers with the $2 levy or absorb it itself – and claimed that “other providers” outside of Uber have already stated they would not pass on the levy to customers.

“Our reforms will regulate Uber and create competition in the rideshare market — which will ultimately drive down prices for passengers,” she said.

Melbourne has seen mass protests from cab owners and drivers urging the state government to regulate the ridesharing industry and to provide compensation for devalued taxi licences.

The government introduced its taxi and ridesharing regulation bill last week that would see the new $2 levy go towards paying perpetual metropolitan licence holders $100,000 compensation for their first licence and $50,000 per licence for up to three additional.

The overall package also sees $50 million allocated for “targeted assistance” for people in the taxi industry experiencing “significant financial hardship” and a rebate for annual licence fees. $25 million has been earmarked for continuity of services for passengers with disabilities.

“The levy will help fund services for people with a disability that Uber do not provide,” said Allan.

The $2 per trip levy is proposed to start next year.

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