Chicago Ground Transportation Tax: Rates, Exemptions, and Filing

The Chicago ground transportation tax is a city tax on every commercial passenger ride that operates within city limits, including rideshare trips, taxi fares, livery and limo service, charter buses, pedicabs, and private medicar runs. It is set out in Municipal Code Chapter 3-46 and administered by the Department of Finance.¹ What you owe depends on the type of vehicle you operate, whether a trip is solo or shared, and whether it touches a congestion zone or a major venue like O’Hare.

Who Owes the Tax

The tax reaches any operator who moves passengers through Chicago for a fee. That covers rideshare companies (called Transportation Network Providers in the code), taxicabs, livery services, private ambulance and medicar companies, charter buses, and pedicabs. The operator carries the legal obligation to either collect the tax from passengers or absorb it as a cost of doing business.¹

Vehicle size drives how the tax gets calculated. Rideshare rides are taxed per trip. Taxicabs are taxed per month or per day. Other vehicles seating ten or fewer pay a daily rate, and larger vehicles move into separate tiers at the 11-passenger and 25-passenger marks.

Rideshare Rates and Surcharges

Rideshare trips are taxed per ride. As of January 6, 2026, the base rates are:²

Single ride: $1.13 per ride
Shared ride: $0.53 per ride
Wheelchair-accessible ride: $0.53 per ride

Two surcharges can stack on top of the base.

Congestion Zone Surcharge

A rideshare trip that picks up or drops off a passenger in a designated congestion zone between 6:00 a.m. and 10:00 p.m. triggers an extra charge. For single rides, the surcharge is $1.50 and applies seven days a week. For shared rides, it is $0.60 and applies only on weekdays. Outside those hours, neither surcharge applies.¹ The current zone boundaries are defined in a map published by the Department of Finance. A solo ride starting in a congestion zone during peak hours owes $2.63 in tax: the $1.13 base plus the $1.50 surcharge.

Airport and Major Venue Surcharge

Any rideshare trip with a pickup or dropoff at O’Hare, Midway, Navy Pier, or McCormick Place carries an additional $5.00 per ride. It applies to both single and shared rides, and it stacks with the congestion zone surcharge when the trip touches both.² A solo rideshare trip starting at O’Hare during peak hours and ending in a congestion zone owes the full stack: $1.13 base, plus $1.50 congestion, plus $5.00 venue, for a total of $7.63.

Taxi, Livery, Bus, and Pedicab Rates

Non-rideshare operators pay per day or per month rather than per trip. The 2026 rates are:¹

City-licensed taxicabs: $98 per month, with no proration for partial months. No tax is owed for months when the cab is fully out of service and the license is surrendered.
Non-city taxicabs: $3.50 per day used in Chicago, capped at $98 per month.
Other vehicles with 10 or fewer seats: $3.50 per day.
Vehicles with 11 to 24 seats: $6.00 per day.
Vehicles with 25 or more seats: $9.00 per day.
Pedicabs: $1.00 per day.

City cabs that own one or two medallions file annually; those with three or more file quarterly. The Department of Finance mails tax coupons showing the correct filing frequency.²

Exemptions

Section 3-46-060 carves out several categories from the tax:³

Vehicles used to transport students to or from school-related activities or events.
Vehicles that cannot be taxed under the federal ICC Termination Act of 1995.
Vehicles operated by a nonprofit when used solely for the organization’s stated purpose.
Vehicles provided to a nonprofit or government body, but only when the fare is billed directly to the organization rather than to individual passengers.
Vehicles used in casual carpool arrangements under the Illinois Ridesharing Arrangements Act. This does not cover commercial rideshare apps.

The nonprofit carve-out catches some operators off guard: if individual passengers pay the fare, the exemption does not apply, even if the trip serves a nonprofit mission.

How to File and Pay

Returns go through Chicago’s Business Direct online portal. Every operator needs a Chicago Business Account Number before filing. Each individual user also creates a personal profile with name, email, and phone number, which acts as the legal digital signature on returns submitted.⁴ If an accountant, attorney, or employee will file on behalf of the owner, they need a letter of authorization from the owner before the system will link them to the account.

The return itself requires trip-level data: total rides or taxable days for the period, trips within congestion zones, trips involving airport or venue surcharges, and any exempt trips. Rideshare companies file monthly, with returns due by the last day of the following calendar month.¹ Taxi operators file quarterly or annually based on medallion count. Payment can be made by ACH bank transfer or credit card, and the portal issues a confirmation receipt.

Penalties for Late or Unremitted Tax

Missing a deadline gets expensive quickly. The city imposes two separate penalties plus interest:⁵

Late payment penalty: 5% of the unpaid tax, assessed as soon as the payment is overdue.
Late filing penalty: the greater of 1% of the total tax due (capped at $5,000) or 5% of the amount payable with the return.
Interest: 12% per year, accruing daily from the day after the due date until payment posts.

Operators who collect the tax from passengers but fail to remit it to the city face a harsher consequence: a penalty equal to 50% of the collected-but-unremitted amount. That penalty can stack with the late filing penalty, and the Department of Finance will waive it only on a showing of reasonable cause.⁶

Audits and Records

If the Department of Finance opens an audit, an auditor will contact you to schedule a start date and send a formal notice specifying the tax periods under review and the records to produce. If you do not make records available, the city can issue a written demand giving you 45 days to comply. Extensions are possible but not guaranteed.⁷

Keep trip logs, vehicle records, fare data, and filed returns for every period the city can still assess. The city may also ask you to sign a waiver extending the statute of limitations if an audit is still open when the assessment deadline approaches. Organized digital records are the strongest protection in both audit and penalty disputes.

The Separate MPEA Airport Departure Tax

Chicago also imposes an MPEA Airport Departure Tax on vehicles carrying passengers departing from O’Hare or Midway. This is a different tax with its own rates and filing requirements, but any operator serving the airports needs to account for both. The MPEA departure rates are:⁸

Taxi or livery vehicle: $4.00 per departure.
Bus or van, 1 to 12 passengers: $18.00 per departure.
Bus or van, 13 to 24 passengers: $36.00 per departure.
Bus or van, 25 or more passengers: $54.00 per departure.
ICC-regulated buses: $2.00 per passenger.

For rideshare drivers, the $5.00 airport surcharge inside the ground transportation tax already applies per trip; the MPEA departure tax is a separate obligation on the operator. Between the two, airport pickups carry the heaviest combined tax load in the city’s ground transportation framework.

1
American Legal Publishing. Municipal Code of Chicago 3-46-030 – Tax Imposed
2
City of Chicago. Ground Transportation Tax
3
American Legal Publishing. Municipal Code of Chicago 3-46-060 – Exemptions
4
City of Chicago. BACP – Register or Login
5
City of Chicago. Tax Division FAQs
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American Legal Publishing. Municipal Code of Chicago 3-4-230 – Failure to Remit Collected Taxes Penalty
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City of Chicago. Tax Audit Process
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City of Chicago. MPEA Airport Departure Tax