The Washington state Revenue Department says that Flexcar car-sharing service is essentially a car rental business and thus its customers have to pay a car rental tax of about ten percent, the Associated Press reports.

This is on top of a nine percent sales tax on the hourly $10 charge.

The Seattle-based company has about 20,000 customers in the city. Flexcar says it's a car-sharing company that should be encouraged for reducing traffic. It could ask the Revenue Department of state lawmakers for an exemption

“We are hopeful that everyone will agree that car-sharing is an innovative service that should be encouraged and whose members should not be burdened by additional taxes,” Flexcar said on a written statement to the media. “National studies have shown that car-sharing members sell or avoid buying cars, reduce vehicle miles traveled, and increase transit ridership.”

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