Mayor Brandon Johnson's plan to expand congestion surcharges on rideshare services like Uber and Lyft has sparked backlash from companies, riders and local commentators, who argue the increase would burden low-income residents and stifle economic growth in a city grappling with elevated inflation and a softening job market.
The proposal, part of Johnson's 2026 budget unveiled earlier this month to address a $1.1 billion deficit, would broaden the current $1.50 flat congestion fee — limited to downtown rides between North Avenue and Roosevelt Road — to a larger area stretching from Foster Avenue north to 31st Street south and west to Western Avenue. The surcharge would shift to a variable 10.25% tax rate based on time of day and drop-off location, aiming to generate $65 million in revenue.
Critics contend the hike comes at a poor time for Chicagoans facing higher living costs. The city's inflation rate stood at 3.1% in August 2025 compared to a year earlier, according to the Consumer Price Index for the Chicagoland area. A recent Federal Reserve Bank of Chicago report highlighted that local inflation has outpaced the national average, reaching 3.3% for the 12 months ending in May 2025 versus 2.4% nationwide, driven largely by housing (5.3% locally vs. 4% nationally) and transportation costs. The report noted Chicago's cumulative price increases since January 2021 at about 20%, underscoring persistent pressures on household budgets amid a tight housing market and vehicle-related expenses.
Rideshare companies have been vocal in their opposition to the proposal. Uber called the fees "fundamentally regressive," arguing they disproportionately affect everyday customers, especially low-income riders who rely on affordable transport. Lyft echoed the sentiment, noting Chicagoans already face some of the highest rideshare taxes and fees in the country, and the expansion would add unnecessary costs to riders.
Local riders interviewed in a recent NBC Chicago report expressed frustration, tying the proposal to broader economic strains. One anonymous resident said, "With inflation going up, it’s like you’re going to add another tax on the people. It’s like, what, eventually you gonna charge me to breathe too?" Another criticized the timing: "I think people right now are struggling with increased costs and inflation and everything that's going on in their lives, food, housing, everything else. So, I think now would be a pretty terrible time to increase yet more costs on people in Chicago to get around."
Former mayoral candidate Paul Vallas, a local commentator, described the congestion tax as "crushing" and ill-advised, predicting it would drive away businesses and jobs while betraying working-class interests. On X, Vallas framed the broader driving-related taxes, including rideshares, as regressive and a "job killer." Another X user, E Nuff, called the Uber rides tax counterproductive to Johnson's goal of "protecting Chicago," risking harm to key revenue sources without fostering growth.
Fairness concerns also emerged. Alec Greef, posting on X, pointed out the unfairness of penalizing necessary peak-hour travel without equitable alternatives.
Statewide in Illinois, lawmakers are considering a separate 10% rideshare surcharge to fund a $230 million transit gap, potentially layering more costs.
Budget hearings continue, with the City Council required to approve by year's end. Proponents say the revenue is essential for city services, but opponents warn of economic fallout, including reduced tourism and business exodus.