Lawmakers work to update state's motor vehicle code so new ride-hailing companies are covered

Economic IndicatorsAssociated Press

Lawmakers are trying to ensure that ride-hailing companies operating in Rhode Island are covered by state law.

The legislative commission that is working to update the motor vehicle code is meeting Tuesday with the general manager of Uber for Rhode Island and Massachusetts and a taxi industry representative.

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The last major revisions to the code occurred in 1950. Much of it hasn't changed since.

"A lot of the technology and transportation in general has changed," said Rep. John Edwards, a commission co-chairman. "It's probably time for a good overhaul."

New companies and the impact of innovative technologies on the market should be addressed and included in the law, Edwards added. He said he wants to make sure that ride-hailing companies are paying taxes and that there are standardized requirements for insurance and background checks.

Lawmakers extended the state's 7 percent sales tax in 2012 to previously exempt automobile ride-for-hire services. But neither Uber nor Lyft has registered to collect and file sales tax in Rhode Island, according to the Division of Taxation.

If a business should collect and remit Rhode Island sales tax but does not, the business can be referred to the division's field audit staff, which can charge interest and penalties.

The division wouldn't say whether Uber or Lyft has been referred, saying it does not discuss details involving specific taxpayers.

An Uber spokesman told The Providence Journal that the company has been holding an undisclosed amount of state sales tax collected from local rides, but it's temporary and the company intends to remit all sales tax eventually.

Lyft says it doesn't collect sales tax in Rhode Island and it's unclear how peer-to-peer platforms should be treated for tax purposes.

Edwards said the commission will likely propose new legislation this session.