Parliamentary committee on the taxi industry: New regulatory framework should set clear rules for all players and foster innovation

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Added on 23 February 2016 in Press releases

Montréal, February 23, 2016 ‒ Today the Board of Trade of Metropolitan Montreal presented its recommendations to the Committee on Transportation and the Environment as part of consultations on passenger transportation by automobile for remuneration. Implementing a new regulatory framework for the taxi industry is particularly important for the city, which accounts for over 60% of the province’s taxi owner licences. The President and CEO of the Board of Trade, Michel Leblanc, reminded the government that the taxi industry is a private industry and that as such the regulatory framework must create healthy competition and be open to the entrance of new players.

Help the industry adapt and quickly adopt advances in technology

“We need to move away from the existing offer’s management system and ensure that the new system promotes innovation and customer satisfaction,” said the President and CEO of the Board of Trade of Metropolitan Montreal. “The tensions we are seeing are the result of a system that for too long has isolated industry actor from competition and customer demands. The market has to be open to new players, including Uber, and must take into account future advances in technology to avoid more upset in the industry a few years down the road.”

Establish clear rules and specific conditions to ensure the transition of the taxi industry

“The current system of taxi owner licences, the initial goal of which was to ensure drivers earned a decent income, is no longer effective at managing passenger transportation for remuneration,” Michel Leblanc said. “The government needs to recognize this and prepare to buy back taxi licences or, at the very least, partially compensate drivers for the loss in value of their licence. Our brief suggests introducing a “buyback tax” on every taxi trip that would apply to every player. Depending to the scenario, this tax would raise between $19 million and $423 million over a 5- to 10-year period, or up to $50,000 in compensation per licence.”

“The government also needs to ensure that all companies, existing or future ones, respect the legal and regulatory framework as well as the province’s tax system,” Mr. Leblanc said. “Tax evasion in the taxi industry currently represents an estimated $75 million per year. So the government must require the full payment of taxes by companies and self-employed workers, even those declaring income of less than $30,000.”

 

“The question of passenger and driver safety is fundamental, and the models currently used by the different players should be compared,” Mr. Leblanc. “And finally, the Board of Trade believes that a regulatory system that encourages healthy competition with rates based on the principle of supply and demand will allow drivers to earn an income that is more fair.”

 

The following is a simplified version of the Board of Trade of Metropolitan Montreal’s seven recommendations:

 

1) Adopt a regulatory framework that governs new applications of remunerated transportation by automobile.

2) Adopt a framework that recognizes the value of innovation and establishes conditions for how services are deployed.

3) Adopt a regulatory framework that can serve as the basis for the future deployment of self-driving cars.

4) Compensate holders of 8,365 taxi owner licences through a tax charged for each trip.

5) Require players in the taxi industry to collect sales tax and submit quarterly reports indicating the number of trips and revenue earned by drivers and partners.

6) Establish a regulatory system to ensure the safety of drivers and passengers, the cost of which would be assumed by the industry.

7) Apply the principle of rates based on supply and demand for all remunerated passenger transportation vehicles in Montréal

To consult the Board of Trade’s brief and full recommendations, click here.

About the Board of Trade of Metropolitan Montreal

The Board of Trade of Metropolitan Montreal is made up of over 7,000 members. Its mission is to be the voice of Montréal’s business community and to promote the city’s prosperity. It is involved in key areas of economic development, advocating a philosophy of action based on engagement, credibility, proactivity, collaboration, and innovation. The Board of Trade also offers a range of specialized services to individuals and to businesses of all sizes to support them in their growth at home and abroad.

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Source : 
Guillaume Bérubé
Advisor, Media Relations
Board of Trade of Metropolitan Montreal
Phone: 514 871-4000, extension 4042
gberube@ccmm.qc.ca

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