Doorstep Delivery Without Extra Taxes

From retail packages to food and grocery deliveries, American consumers and small businesses rely on the delivery economy each and every day.

In 2022, Colorado residents started paying a new 27 cent “doorstep” tax on every restaurant, grocery and e-commerce purchase delivered directly to their homes. Despite growing backlash from consumers and businesses in Colorado, other states are considering imposing similar harmful doorstep taxes.

A Delivery Tax Hurts Families & Workers

1

American families rely on delivery

Doorstep delivery is a critical, often overlooked part of everyday life in America. Families working long hours, elderly people, the disability community and those living in rural and remote localities depend on affordable and accessible delivery services for prescriptions and other essentials.

2

Doorstep taxes result in DOUBLE taxation on consumers

In Colorado, where doorstep taxes are in place,  some localities have imposed their sales tax on top of the new doorstep tax, resulting in double taxation for consumers.

3

Delivery powers small business growth and jobs

Doorstep delivery of food, groceries and packages supports millions of jobs in the U.S and helps to expand the customer base for businesses. Conversely, in Colorado where doorstep taxes are in place, small businesses have reported spiking compliance and accounting costs at a time when they can least afford it.

4

Extra taxes means fewer deliveries & reduced wages for workers

Delivery jobs employ a wide spectrum of Americans. Gig workers and delivery drivers earn less when consumers choose fewer deliveries.

5

Taxing deliveries adversely impacts the climate

Driving to and from the store produces more greenhouse gas emissions than delivery.  Delivery taxes incentivize customers to shop with personal vehicles, increasing emissions.

Americans are already suffering from record inflation, supply chain shortages, and sky-high prices. The last thing working families need is new, burdensome taxes that would exacerbate these problems by levying higher costs on consumers while hurting workers.

Who is Impacted?

With 10 deliveries per month, households aged 35-44 had the highest average number of monthly deliverables. This means younger Americans are bearing the brunt of the burden caused by additional fees

However, the distribution of delivery orders was not significantly different across political views. Liberals and conservatives are just as likely to rely on delivery–and be forced to pay delivery fees.

For many households, delivery is a necessity and not a luxury, with 20% reporting that they relied on delivery due to a disability or other mobility issue because they did not have help from family members or other sources.

Delivery fees also account for a higher share of household income for lower income households vs. higher income ones, confirming the regressive nature of delivery fees

Read the full report for more details on how delivery fees impact the already burdened.

American Families Depend on Delivery

Doorstep deliveries are an integral part of daily life for most Americans, and the delivery ecosystem is a growing and essential service for families across the U.S. The growth of doorstep delivery has provided a convenient and accessible way for consumers to receive essential items, food and various other goods, empowered small businesses and local restaurants to expand their customer bases and supported millions of jobs.

Preserving an efficient and convenient delivery economy is critical in supporting American consumers, small businesses and workers. Raising costs via doorstep delivery taxes will only increase the price of everyday items — the last thing Americans need.

What People Are Saying

"This fee is regressive, impacting our guests and delivery employees. While 75 cents might not seem like a lot, it is significant."

"I'm here to give a service and when we're adding more and more to the small business owners' plates, it's so much harder to do that…I continue to have to pay for more accounting services and administration just to make sure my taxes are being paid right now."

"A very large percentage of my customers will be affected by this. I’m sure once they end up on the website and they see an additional fee, I will be getting phone calls on that…There’s so many hats involved in being a business owner, it’s really hard to kind of start to have to educate my customers now that we have this whole new fee and it’s just a whole extra thing. And it’s very time consuming."

“This proposed delivery fee mandated on nearly every Minnesota consumer undoes any progress made post pandemic, and will negatively impact everyone involved. As the state looks for thoughtful solutions to solve transportation challenges, the proposed fee will enable more harm than good.”

“New Yorkers rely on delivery services on a daily basis…A regressive tax like this will do more harm than good. This cannot be allowed to gain a foothold. 25 cents may seem insignificant but Albany has a habit of using new taxes such as this as a starting point, not a finish line.”

“Consumers and businesses don’t need an entirely new, complicated taxing system when we already have several existing mechanisms in place to raise funds for transportation…Calling the tax a ‘road improvement fee’ won’t fool Minnesotans.”

“Removing the delivery fee certainly leads me to enthusiastically support your bill. Before that there was some hesitancy. I might add, with those particular removals from the bill, I am enthusiastically a supporter.”

“For a growing number of Americans, deliveries are not a luxury – they are a necessity. Working parents, the disabled community, seniors and those living in food deserts all depend on accessible delivery services”

No Doorstep Tax is a project of the Chamber of Progress.

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Delivery Tax News

Legislatures & Communities Across the U.S. Oppose Regressive Delivery Taxes

Colorado Delivery Tax: Top Issue for Voters

Infrastructure Funding
Alternatives to Doorstep Taxes

Colorado is a clear outlier. No other state is seriously considering imposing delivery taxes. Below are just a few examples of how other states’ are addressing declining gas tax revenues.  

Virginia’s Mileage Choice Program

"More than 7,000 Virginians have signed up to pay a fee for each mile they drive under a program launched this summer, putting the state at the forefront of a nationwide effort using new technology to prop up gas taxes that pay for roads.”

Utah’s Road Usage Charge Program

"The road usage charge program, a voluntary pilot program that started in January 2020, allows users to pay based on miles driven using a device in their car. Users are given the option to pay 1.5 cents per mile traveled or an annual flat fee of $120 for electric vehicles or $20 for gas hybrids. Per-mile payment stops when the accumulated total for the year reaches the flat fee, so customers can pay less if they drive less.”

Oregon’s Road Usage Charge Program (OReGO)

"OReGO is a voluntary road-usage fee program that allows drivers to pay 1.8 cents per mile traveled. The project could also serve as a mechanism for collecting highway funding from electric vehicle drivers.”

Massachusetts’ Fair Share Amendment to Fund Education & Transportation

"Massachusetts voters have approved a constitutional amendment to increase the tax rate on incomes over $1 million a year in order to generate more revenue for the Commonwealth's transportation and education programs.”

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