Open Letter

California’s AB 286 is a hidden tax on consumers and small businesses. The legislature should vote NO

Our coalition of community organizations, minority-owned businesses, small businesses,
taxpayer advocates restaurants, merchants and app-based drivers strongly oppose Assembly
Bill 286. While AB 286 purports to help restaurants and merchants, the bill will result in
increased costs to consumers, reduced business and revenues for restaurants, and fewer
income-earning opportunities for drivers.

AB 286 is a hidden tax on consumers and small businesses and would hurt the very restaurants
it is intended to protect.

App-based delivery platforms connect restaurants, customers, and drivers. Fees are carefully
balanced to reflect the mutual benefits to each party: fees on restaurants help pay for marketing,
payment and insurance for drivers, customer service, and other services that help restaurants
gain customers and grow business. Fees on customers reflect the convenience and value of the
delivery service while also ensuring fair payment to drivers.

AB 286 would arbitrarily and permanently cap fees paid by restaurants and will force prices to
rise on consumers in order to ensure adequate revenues to provide app-based delivery
services. For instance, a 15% cap on a typical $20 food order is $3. That $3 is insufficient to
pay for the driver, insurance, marketing, credit card processing fees, customer support,
technology, and costs of operating the platform.

Because of this, in communities that have passed these arbitrary fee caps, consumer prices
have increased to compensate and ensure that app-based delivery remains viable. In cities that
have implemented these arbitrary fee caps, consumer costs have immediately gone up by $2-3
per order.

Higher prices are proven to reduce demand by as much as 30%, taking away customers and
business from restaurants that are struggling to stay afloat during these challenging times. AB
286 will be particularly harmful to small independent restaurants trying to compete with larger
chains that have their own marketing and even delivery services. Furthermore, while AB 286
purports to help restaurants struggling with the pandemic, it is permanent in nature and won’t
even go into effect until 2022.

And the higher prices also harm drivers working with app-based platforms, as reduced demand
for services means fewer work opportunities for drivers, less income for drivers and reduced
sales tax revenues for municipalities.

Finally, AB 286 is unnecessary. California recently passed legislation (AB 2149) that requires
app-based platforms to enter into a contract with every restaurant and merchant they list on
their app. As a result, every restaurant or merchant that utilizes app-based delivery services
has voluntarily entered into an agreement with full transparency into the terms, fees, and
benefits of partnering with these platforms.

We strongly urge you to vote No on AB 286. It hurts restaurants, customers, and app-based
drivers.

Sincerely,

Lily Rocha, President, Latino Restaurant Association
Julian Canete, President & CEO, California Hispanic Chambers of Commerce
Pat Fong Kushida, President & CEO, CalAsian Chamber of Commerce
Rev. KW Tulloss, President, Baptist Ministers’ Conference of Los Angeles and Southern California
Matt Regan, Senior Vice President, Bay Area Council
Cindy Roth, President & CEO, Greater Riverside Chambers of Commerce
Reuben Franco, President & CEO, Orange County Hispanic Chamber of Commerce
Elise Swanson, Chair, South Bay Association of Chambers of Commerce
Jessica Lall, President & CEO, Central City Association – Los Angeles
Yaël Ossowski, Deputy Director, Consumer Choice Center
Heidi L. Gallegos, President & CEO, Brea Chamber of Commerce
Leah Vukmir, VP of State Affairs, National Taxpayers Union
Moises Merino, President, Latino Leadership & Policy Forum
Ruben Guerra, President and Chair, Latin Business Association

Rev. Jonathan E. Moseley, Western Regional Director, National Action Network – Los Angeles
David Cruz, President, League of United Latin American Citizens Council 3288
Jay King, President & CEO, California Black Chamber of Commerce
Faith Bautista, CEO, National Diversity Coalition
Stuart Waldman, President, Valley Industry & Commerce Association (VICA)
Marc Ang, Founder/President, Asian Industry B2B
Peter Leroe-Muñoz, General Counsel, SVP, Tech & Innovation, Silicon Valley Leadership Group
Thomas Hudson, President, California Taxpayers Protection Committee
Adam Ruiz, Chair, Southwest California Legislative Council
Faith Bautista, President & CEO, National Asian American Coalition
Brandon M. Black, Director of Public Policy, Sacramento Metropolitan Chamber of Commerce
Thomas Hudson, President, Placer County Taxpayers Association
Dominik Knoll, CEO, Redondo Beach Chamber of Commerce
Cindy Spindle, CEO, Garden Grove Chamber of Commerce

PDF LINK HERE

Coalition Letter in Support of Mileage-Based User Fees for US Highway Funding

Dear Member of Congress,

As Congress considers surface transportation reauthorization, its top priority should be restoring the longstanding users-pay/users-benefit principle for highway funding. Further increasing the reliance of the Highway Trust Fund on revenue streams untethered from use, as well as general fund bailouts, would not only fail to address the core fiscal challenges of the present, it would threaten the future health of America’s highways.

Congress should closely examine lessons learned in the numerous ongoing state road usage charge pilot programs and build any future federal trials upon those findings, including ensuring that all forms of surface transportation are covered, including heavy trucks and passenger vehicles. A federal road usage charge trial should be nationwide in scope and done in cooperation with the states, building on best practices developed across the states, and should focus on replacing fuel taxes.

When Congress passed the Federal-Aid Highway Act of 1956, which created the modern Interstate Highway System, this was coupled with the Highway Revenue Act. The Revenue Act established the Highway Trust Fund, which authorized the Treasury to collect taxes on producers and importers of fuel, who then pass most of that tax burden on to road users.

Set at a per-gallon rate, the rationale for the taxes was to link highway use with highway infrastructure investment. Prior to the creation of the Highway Trust Fund, federal-aid highways were funded out of general revenues and drivers did not bear the costs of the infrastructure they used. In addition, all federal taxpayers—even those who did not drive—were thereby forced to pay for highways.

Adhering to the users-pay/users-benefit principle is superior to general revenue funding for a number of reasons:

  1. Fairness: Highway users benefit from the improvements their user fees generate.
  2. Proportionality: Users who drive more pay more.
  3. Self-limiting: The imposition of a fee under which proceeds may only be used for the specified purpose imposes a de-facto limit on how high that fee can be.
  4. Funding Predictability: Highway use and therefore highway user revenues do not fluctuate wildly in the short-run.
  5. Signaling Investment: Because revenue roughly tracks use, the mechanism provides policy makers with an important signal as to how much infrastructure investment is needed to maintain a desired level of efficiency.

Congress should also make clear what the users-pay/users-benefit principle is not intended to do:

  1. Road usage charges should replace fuel taxes, not supplement them.
  2. Road use charges are not a tax, but a user fee.
  3. Any users-pay/users-benefit program is not intended to force behavioral change, nor should the program have any environmental or social goals beyond the adequate funding of the Trust Fund.
  4. User fees are not a surveillance program and best practices being developed at the state level ensure that users’ data are protected from misuse.
  5. User fees are not intended to force rural drivers to pay more, any more than fuel taxes punish rural drivers who tend to drive longer distances in less fuel-efficient vehicles.

For these reasons, we urge you to prioritize protecting and strengthening the users-pay principle in the 2021 surface transportation reauthorization and support the development of a nationwide, interoperable road usage charge trial.

Sincerely,

Iain Murray
Vice President for Strategy
Competitive Enterprise Institute

The Honorable Andrew H. Card, Jr.
Former White House Chief of Staff, United States Secretary of Transportation

Douglas Holtz-Eakin
President
American Action Forum*
*Affiliation for identification purposes only

Hon. Samuel K. Skinner
Former United States Secretary of Transportation

James L. Martin
Founder/Chairman
60 Plus Association

Saulius “Saul” Anuzis
President
60 Plus Association

Steve Pociask
President / CEO
American Consumer Institute

Ike Brannon
President
Capital Policy Analytics

Andrew F. Quinlan
President
Center for Freedom and Prosperity

Matthew Kandrach
President
Consumer Action for a Strong Economy

Yaël Ossowski
Deputy Director
Consumer Choice Center

Ian Adams
Executive Director
International Center for Law & Economics

Brandon Arnold
Executive Vice President
National Taxpayers Union

Adrian Moore, Ph.D.
Vice President of Policy
Reason Foundation*
Former Commissioner, National Surface Transportation Infrastructure Financing Commission
*Affiliation for identification purposes.

David Williams
President
Taxpayers Protection Alliance

Roslyn Layton, PhD
Aalborg University
Senior Contributor, Forbes

Tom Giovanetti
President
Institute for Policy Innovation

FULL PDF

Consumer Choice Center joins group pushing back on breaking up U.S. tech companies

On January 21, the first full day of President Joe Biden’s administration, the Consumer Choice Center joined a coalition of taxpayer and consumer groups in calling on members of Congress to avoid using antitrust to break up tech firms.

Dear Leader McConnell, Leader McCarthy, and Republican Members of Congress:

On behalf of the undersigned organizations, representing taxpayers, consumers, and free market advocates across the nation, we write in strong opposition to proposals from across the ideological spectrum to change substantive antitrust standards that encourage courts to break up and destroy American technology companies. While we sometimes are concerned with the actions of these companies, as long-time supporters of free markets and free expression, we are troubled to see that some fellow conservatives would try to use the sledgehammer of big government to attack companies they may disagree with on a political or ideological basis.

This is a divisive period in our nation’s history, and with the democratization of news and information many policymakers are asking tough questions about the role technology plays in modern society. Congress may decide to legislate in the near future on matters like online consumer protection, data privacy, content moderation, and more. Regardless of what bills lawmakers introduce in the coming months — or what regulations or lawsuits are introduced by a new administration — our organizations firmly believe that the courts, not Congress, should determine whether America’s most successful companies have violated the antitrust laws. Congress should not change substantive laws to address political or ideological concerns about the companies in question. This is also the wrong message to send to entrepreneurs who are actively working to provide Americans with competitive alternatives to today’s household names.

In the past, conservatives and free market advocates agreed that the powers of the federal government are too great, and the societal and economic benefits of emerging technologies too strong, for true advocates of limited government to support politically-motivated efforts to tear apart successful firms simply because they’re big or for any number of other arbitrary reasons. These companies provide valuable services to hundreds of millions of American and global consumers. That assumption has now been challenged by recent “conservative” calls to “demand the breakup” of major technology companies. As policymakers face a White House and Congress controlled by one party for the next two years, it is imperative to avoid setting a precedent that companies who do not abide by the norms and rules of the governing party find themselves in the crosshairs of vindictive punishment down the road.

Therefore, it is worth reiterating to our allies in Congress and our colleagues throughout civil society: antitrust enforcement should never be used as a political or ideological tool. Instead, antitrust regulators and lawmakers should adhere to the prudent, decades-old consumer welfare standard, which has long been a ‘north star’ for antitrust enforcement and that — when properly applied — allows free-market economies to innovate and thrive.

Thank you for your consideration, and should you like to discuss these matters further we are at your disposal.

Sincerely,

National Taxpayers Union

Taxpayers Protection Alliance

ALEC Action

American Consumer Institute

Americans for Prosperity

Center for Freedom and Prosperity

Competitive Enterprise Institute

Consumer Choice Center

FreedomWorks

Libertas Institute

Lone Star Policy Institute

Market Institute

NetChoice

R Street Institute

Small Business & Entrepreneurship Council

TechFreedom

Proposed ban on all vape flavours

To whom it may concern,

On behalf of the Consumer Choice Center, a global consumer advocacy group representing millions of consumers in Europe and globally, I am writing to express our great concern at the proposed ban on all vape flavours. We need policies that are science-based and enhance consumer choice instead of hurting adult consumers and undermining their ability to choose for themselves. 

The Netherlands has always been one of the few islands of liberalism, an exemplar of rational openness to innovation. In the Netherlands, 3.1% of adults use e-cigarettes, and with the ban in place, nearly 260,000 Dutch vapers might return to smoking. Both short-term and long-term, that is too high of a price to pay, especially in light of our shared European efforts to reduce cancer rates.

In order to see why the proposed vape ban would be a disastrous move that the Dutch government should avoid. 

First, vaping was invented as a harm reduction tool aimed at adult smokers to help them switch to a safer alternative and conversely reduce health-associated risks.

Vaping has been proven to be 95% less harmful than smoking and has been endorsed by the UK, New Zealand, and Australia government bodies as a safer alternative.

As demonstrated by Public Health England, vaping is 95% less harmful than tobacco cigarettes. Prof. Peter Hajek stated “My reading of the evidence is that smokers who switch to vaping remove almost all the risks smoking poses to their health”. Prof. McNeill et al., E-cigarettes around 95% less harmful than tobacco estimates landmark review, 2015

Second, allowing smokers to experiment with vape flavours is a key part of cessation through vaping.  Two-thirds of current vapers are using some form of flavoured liquids. Vapers prefer non-tobacco flavours over tobacco flavoured e-cigarettes, mainly because flavours don’t remind them of the taste of cigarettes. 

A nationally representative longitudinal study of over 17,000 Americans, over a five year period, showed that adults who used flavoured vaping products were more likely to quit smoking cigarettes when compared to vapers who consumed tobacco flavoured vaping products. When comparing the two groups, those who use flavours and those who use tobacco flavours, vapers that used flavours were 2.3 times more likely to quit smoking than those vaping tobacco flavoured products.

According to research on vapers in Canada and the U.S, a majority of vapers use non-tobacco flavoured vape products as their personal preference. Consumers generally prefer flavours over tobacco flavoured vaping products because of their taste, but also because tobacco flavours remind consumers of conventional cigarettes. Of those surveyed, who are considered regular users, 63.1% use non-tobacco flavoured products (fruit, mint, candy). These adults found vaping more satisfying (compared with smoking) than vapers using tobacco flavour. 

In our latest paper Vaping as a gateway out of smoking, we have debunked the most spread myths related to vaping, including youth vaping and nicotine addiction. After reviewing an extensive number of studies on the topic, we at the Consumer Choice Center are of the opinion that banning vape flavours would not only be a violation of consumer choice but, above all, a scientifically ignorant policy. The Dutch government can do better than such proposals and continue a long tradition of freedom on the continent instead of resorting to unjustified paternalism.

Adult smokers should have a choice to switch to a safer alternative that has proved to be an effective cessation tool, and vape flavours are instrumental in making those efforts a success. We need to embrace vaping to reduce health-associated risks such as cancer. For smokers, and for future generations.

Kind regards,

Maria Chaplia
Research Manager 
Consumer Choice Center

Open Letter on EU Airlines

Dear Director-General Mr. Hololei,

On behalf of the Consumer Choice Center, the consumer advocacy group representing and empowering consumers in the EU and globally, we would like to express our deep concerns about the Commission’s intention to extend the waiver of the “use-it-or-loseit” rule for the entire 2020-2021 winter season. In our view, such a move would be extremely protectionist, distortive, and would do more harm than good.

The overwhelming uncertainty around the second wave of coronavirus, travel restrictions, and a significant drop in demand are some of the crucial issues the aviation industry has faced. It is therefore in the interest of consumers, airports, and the industry itself to arrive at a mutually satisfactory solution. What we need in these times is to encourage more connectivity and not less. Extending the waiver will likely keep flight connections and destinations way below the pre-COVID times. Now might be the right time for new entrants into the market to connect people across Europe and the world.

The current waiver of the requirement to fly 80% of granted slots or lose them is set to expire on October 24th. Multiple associations have called on the Commission to extend the waiver “to ensure that the flying of empty planes is avoided” so that “flights are operated in the most sustainable
way possible.” However, the extension would create the situation in which the biggest airlines will get a chance to monopolise the slots making it impossible for the smaller ones to enter. This explains why low-cost airlines such as Wizz Air oppose the extension of the waiver calling it anti-competitive and such that “would hinder rather than help the recovery of the EU aviation industry and, therefore, European economies.”

Airport slots are scarce, and that is why they are so valuable and have to be put to the most efficient use. Though pursued out of noble motives, the Commission’s waiver policy implies that the airlines are the sole owner of the slots.

The airport slot ownership shouldn’t be static. On the contrary, it should constantly rotate between airlines to guarantee the most efficient allocation of the facilities and to encourage responsible use of airports. The “use-it-or leave-it” rule is, in this sense, fair and just, and should be sustained at all
times.

Flying has changed our lives in many ways. Now that consumers all across Europe have got a taste of life without travelling, they would want to fly more not less once the pandemic is over. The European Commission should focus on ensuring that they have a chance to choose between multiple airlines keeping in mind their budget constraint. In order to achieve this,
both big and low cost companies have to be treated equally and compete for airport slots.

It is still not too late to preserve competition and consumer choice. With that in mind, the Consumer Choice Center calls on the Commission to reconsider formalising the extension for the entire 2020-2021 winter season. On our end, we would be keen to elaborate further on our
view and help the Commission find the most optimal solution.

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