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Munich plans minimum wage for rental cars: City council discusses regulation of Uber & Co.
The Munich City Council is expected to decide on the introduction of a minimum wage for rental cars at the end of April 2025. The measure aims to regulate competition in the ride service market and curb illegal business models. The city is responding to ongoing problems in the sector of platform-based rental car services.
Growing number of violations in the rental car sector
According to information from administrative and investigative circles, numerous rental car companies in Munich are operating in circumvention of applicable regulations. Typical issues include tax evasion, insufficient or missing social contributions, avoidance of local business tax payments, and violations of the Passenger Transportation Act. Unregistered vehicles and inadequate insurance coverage are also regularly found.
Seat relocations complicate urban control
Although the vehicles in question predominantly operate within the Munich city area, less than 20 percent of the companies have their headquarters in the state capital. Many providers relocate their official business locations to the surrounding area, significantly limiting the control options of the Munich authorities. This practice is assessed by experts as a targeted strategy to circumvent local regulations.
Minimum Wage as an Economic Necessity
According to proponents, running an economically viable business below the current taxi fare under today's traffic conditions is not possible. In Munich, the average speed in city traffic is around 18 km/h, which high order numbers cannot compensate for. Therefore, a minimum price is considered a prerequisite for legal cost coverage in the rental car business.
Industry Association Supports Regulatory Initiative
The Federal Association of Taxi and Rental Cars advocates for the introduction of a minimum wage. The planned measure is intended to promote the compliance with legal standards and create legally secure frameworks for reputable providers.
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