ARE TAXES ON CARSHARING TOO HIGH? A REVIEW OF THE PUBLIC BENEFITS AND TAX BURDEN OF AN EXPANDING TRANSPORTATION SECTOR By Alice Bieszczat and Joseph Schwieterman, Ph.D.* June 28, 2011 Chaddick Institute for Metropolitan Development DePaul University 243 S. Wabash Avenue, Chicago Chicago, Illinois 60604 www.depaul.edu/~chaddick *Authors are listed alphabetically. Bieszczat is a research associate at the Chaddick Institute. Schwieterman, the corresponding author, is Professor in the School of Public Service and Director of the Chaddick Institute at DePaul University and can be reached at
[email protected] This report was made possible by internal financial support from the Chaddick Institute, which promotes effective planning and transportation. The Chaddick Institute receives no financial support from and has no affiliation with individuals or organizations involved in carsharing. The authors gratefully acknowledge Susan Shaheen, Ph.D., for her extensive technical assistance and Lauren Fischer, Nate Frey, Paige Largent and Rebecca McAlphine for editorial support. TABLE OF CONTENTS Executive Summary 1 I. Introduction 2 II. Evolution of Carsharing in the United States 2 III. Does Carsharing Generate Public Benefits? 11 IV. Measuring Levels of Taxation 20 V. Conclusions 30 VI. Appendices 32 Demographic Profile of Carsharing Users Institutional Savings from Carsharing VII. References 36 VIII. Endnotes 40 EXECUTIVE SUMMARY This study evaluates the size and impact of taxes currently being levied on carsharing services–the sharing of motor vehicles through memberships in nonprofit and for-profit enterprises. By reviewing the tax burden that this sector faces against the backdrop of evidence about the effects of carsharing services on communities, this study makes four principal conclusions: The benefits of carsharing services have been extensively documented in peer-reviewed scholarly research and provide a strong rationale for units of government to adopt policies that encourage greater public participation in such programs.