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Phoenix airport rideshare tax not going into effect until Supreme Court makes decision

Arizona Attorney General Mark Brnovich said Wednesday that the city of Phoenix’s new airport rideshare tax increases won’t go into effect until the state’s Supreme Court rules if the ordinance is constitutional.

The tax increases on rideshares to and from Phoenix Sky Harbor International Airport were set to take effect on Feb. 1 after the City Council passed the ordinance in December. 

The city has agreed to stay the ordinance until the Arizona Supreme Court makes a decision, according to a letter from the city’s attorney.

“The City of Phoenix has backed down from enforcing their unconstitutional rideshare fees for now,” Brnovich said in statement Wednesday. “This is a win for consumers but this fight continues at the Arizona Supreme Court. I will always defend the constitutional rights of Arizona voters.”

The city’s decision comes after Uber sent a notice letter to the city on Tuesday saying it would cease operations at the airport on Jan. 31. 

Brnovich on Tuesday requested that the Supreme Court consider the city’s rideshare tax and asked the court to put a stay on the ordinance until a ruling was made in the case. 

Brnovich’s office said last week it believes the city’s rideshare tax was unconstitutional, citing Proposition 126, a constitutional amendment that banned local governments from imposing or increasing fees for “any service performed in this state.”

Arizona AG’s Office: Phoenix’s airport rideshare tax increase ‘very likely’ violates state constitution

Jan. 16, 2020

The Arizona Attorney General’s Office released a report Thursday saying Phoenix City Council’s recently passed tax hikes on ride shares going to and from Phoenix’s airport “very likely” violate the state’s constitution.

“The Phoenix City Council is placing its policy preferences above the rights of the people to whom the government must always answer,” Attorney General Mark Brnovich said in a statement. “Arizona voters clearly spoke when they overwhelmingly approved Proposition 126.”

Phoenix City Council passed the tax increases on rideshare use at Phoenix Sky Harbor International Airport last month despite warnings that the move was unconstitutional.

Proposition 126, approved by voters in 2018, banned local governments from imposing or increasing fees for “any service performed in this state.”

Rep. Nancy Barto, R-Phoenix, filed a request under Senate Bill 1487, which requires the Attorney General’s Office to investigate local governments suspected of violating state law, thus triggering Brnovich’s investigation. 

Brnovich will also ask the Arizona Supreme Court for an expedited ruling on Phoenix’s tax hikes, he said. 

“This is the most definitive way to provide clarity on the law, protect Arizona taxpayers, and hold the City of Phoenix accountable,” Brnovich added.

A spokesperson for Mayor Kate Gallego, who voted for the tax increases, did not respond to a request for comment.

Councilman Sal DiCiccio, a vocal critic of the tax increases, said “it is clear this horrible tax is not only a direct attack on working and middle class families, but it is also an outrageous violation of our constitution.” 

“I am confident that the Supreme Court will throw out the horrible burden that PHX politicians recklessly imposed,” he added.

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