Transportation Commerce Tax (Beginning July 1, 2025)
Transportation commerce tax is due on the gross receipts derived from for-hire ground transport service. The tax is due if a passenger boards the vehicle in this state and regardless of whether the service is completed. The tax must be collected by a taxi service regulated under N.C. Gen. Stat. § 160A-304A or a transportation network company as defined in N.C. Gen. Stat. § 20-280.1.
What Tax is Due?
The tax is due on the gross receipts of the for-hire ground transport service and the tax rate depends on the type of transport service provided.
| Type of Ground Transport Service | Tax Rate |
|---|---|
| Exclusive-Ride Service | 1.5% |
| Shared-Ride Service | 1% |
Types of Services
- Exclusive-ride service - A for-hire ground transport service requested by a passenger who requests exclusive use of the vehicle.
- Example: An individual or a group of friends requesting a ride from a transportation network company and being matched with a driver. The individual or group of friends ride to one or more destinations without being matched with other passengers by the transportation network company and pay a single fare.
- Shared for-hire ground transport service - A for-hire ground transport service for which an individual has been matched with another individual by a for-hire ground transport service provider. A shared for-hire ground transport service requires the for-hire ground transport service provider to match the individual riders. It does not apply to individual riders that coordinate with each other to occupy the same vehicle and split a single fare.
- Example: A transportation network company connects a passenger with another passenger along the planned route. The two separate riders are in the vehicle together for a portion of the ride and pay two separate fares.
Gross Receipts
Gross receipts subject to the transportation commerce tax include the following:
- Trip fare.
- Booking fees.
- Surcharges.
- Fuel charges.
- Fees for using a credit card.
- Cleaning fees.
- Wait time fees.
- Fees for toll expenses of the service provider.
- Charges associated with rides to and from the airport.
- Any other fees or charges for the service.
How to Register?
A for-hire ground transport service provider must register with the Department using Form NC-TCR, Registration Application for Transportation Commerce Tax.
Only the following types of businesses should register with the Department:
- Transportation Network Company (as defined in N.C. Gen. Stat. § 20-280.1)
- Taxi Service (regulated under N.C. Gen. Stat. § 160A-304)
Note: Individual drivers should not register with the Department unless the driver owns and operates a Taxi Service.
How to File and Pay?
The tax will be report on Form E-500T, Transportation Commerce Tax Return. Taxpayers will be able to securely file and pay online.
How do I Learn More?
For additional information about the transportation commerce tax, review the following information:
In addition, the Department is offering a webinar for service providers to learn more about the tax. Sign up and discover more education opportunities on the customer education page.
How Do I Find More Resources?
- Filing Frequency and Due Dates
- Directives Regarding Transportation Commerce Tax
- How to Amend Your Return
- Form E-505 (this form includes legislative changes to the taxes administered by the Sales and Use Tax Division by year)
- Yearly Law Changes Publications
- NC General Statutes - Chapter 105, Article 5J
Forms
To ensure you are able to view and fill out forms, please save forms to your computer and use the latest version of Adobe Acrobat Reader. Frequently Asked Questions about Forms.
| Form | Description | Electronic Options |
|---|---|---|
| NC-TCR | Registration Application for Transportation Commerce Tax | Register Online |
| E-500T | Transportation Commerce Tax Return - Instructions | File and Pay Online (coming soon) |
| NC-19 | Claim for Refund of Taxes | |
| NC-AC | Business Address Correction | |
| NC-BN | Out-of-Business Notification |