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Forget Sin Taxes, Tax Cycling


 Will bike commuters in the United States ever face the parking problems that exist in Ghent, Belgium?

The idea behind taxing sins is easy to understand, if not universally applauded. Sin taxes raise revenue and have the potential to curb behavior that ends up costing states lots of money. But what’s this about slapping taxes on healthful activities, like cycling?

Take note, cyclists: healthful activities are sometimes taxed. The City of New York imposed sales tax on yoga studios in 2012.

Imposing some sort of tax on cycling has been proposed by several cities and states, including Seattle and, most recently, Chicago. Lawmakers in Georgia considered imposing a $15 fee on bikes last year but quickly withdrew the idea; and many cyclists in Portland, Oregon, support a “4% statewide excise tax on new bike sales.” (The proposed Oregon bike tax was eventually rejected.)  The motivation behind a bike tax is clear: cities that make life easier for cyclists do so at a cost. Bike lanes don’t grow on trees—they are carved out of trees and sidewalks and existing roadways—and some people want the people who use them to help pay for them.

On the other hand, the more people pedal to work, the fewer cars on streets. That benefits cities. Cars chew up asphalt more readily than do bicycles. Cars pollute more than bicycles. Commuters sit in cars while stuck in traffic, feeling their blood pressure rise and their fannies expand. Cyclists get exercise (lowering blood pressure and firming fannies?) as they commute to work. Assuming no accidents, cycling should lower costs to cities and states the way more sinful behavior raises them. When the $25 sales fee on bikes was revealed in a Washington transportation package, the Seattle Bike Blog responded with statistics on how “bicycling actually saves the government money.

 

Plus, many people who own bicycles also own cars. They already help pay for the roads on which they drive and cycle.

Cycling will prevail

Evidence reveals that a tax on bicycles would not put an end to cycling. Hawaii has a bicycle tax. So does Colorado Springs, Colorado; revenue generated by these taxes funds the construction and maintenance of off-street bicycle paths, as well as other bike-related issues. And lots of people in Hawaii and Colorado Springs ride bikes.

But for now, Hawaii and Colorado Springs are anomalies. When a bike tax was proposed for Chicago, Mayor Rahm Emanuel acknowledged, “I surely don’t want police involved in policing whether you bought a bike license,” even as citizens wondered if “every little kid riding down the sidewalk” would have to have a bike license (Chicago Tribune).

Managing sales tax is a bear, no matter how you commute to work. An automated solution allows more time in the saddle.

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Full disclosure: I sometimes ride my bike to work.

photo credit: moarplease via photopin cc


Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.