Dec 6, 2021
Uber likely to start charging VAT on rides after UK ruling
Uber has said it may soon have to start charging its UK customers VAT at 20%, after a High Court judgement, pushing up the cost of rides. At the time, Lord Justice Leggatt suggested this ruling meant that a private hire operator such as Uber had to enter into a contract with its customers when it accepted a booking, rather than the passenger only having a contract with the driver of the vehicle. Unlike most private drivers, Uber is a VAT-registered business, so this would oblige the ride-hailing firm to start charging the tax. A spokesperson for Uber said: "Every private hire operator in London will be impacted by this decision, and should comply with the Supreme Court verdict in full." The case referred to the Private Hire Vehicles Act 1998 which only applies in the capital, but Uber and the App Drivers and Couriers Union, which was a defendant in the case, both expect the ruling to be followed by licencing authorities across the UK.James Farrar, general secretary of the App Drivers & Couriers Union, said: "Rather than fix its broken business model, Uber was determined to double down on misclassification at the cost of worker rights, passenger safety and the avoidance of VAT."Our victory will now make misclassification unlawful, transform the London minicab industry for the better and finally eradicate sector wide worker rights abuses.
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