
Uber is being sued for hundred of millions dollars for allegedly avoiding UK VAT - bartkappenburg
https://qz.com/937255/uber-is-being-sued-by-jolyon-maugham-for-millions-of-dollars-for-avoiding-value-added-tax-in-the-uk/
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ziszis
AirBnb charges and pays VAT in the UK and EU [1]. EBay charges and pays VAT in
the UK and EU [2]. I understand that companies want to avoid paying taxes, but
I wonder what the legal reasoning was that led Uber to decide not to. Uber
needs to pick its battles better.

[1] [https://www.airbnb.com/help/article/436/what-is-vat-and-
how-...](https://www.airbnb.com/help/article/436/what-is-vat-and-how-does-it-
apply-to-me)

[2] [http://sellercentre.ebay.co.uk/business/about-
vat](http://sellercentre.ebay.co.uk/business/about-vat)

~~~
dalore
Uber is arguing that they aren't taking the money, but the driver is. And so
the driver pays the vat.

Uber would have to pay VAT on the part they take from the driver though. Uber
take what 30%? So if you had a £100 ride, the driver takes up £70. The driver
will be under the VAT threshold and so doesn't have to charge VAT. However,
Uber's £30 they took from the driver should have VAT. I've heard from drivers
that Uber adds lots of fees so I wouldn't be surprised if they actually took
£36 from the driver and charged him £6 VAT.

That VAT would go the UK government, but it would be offset by any expenses
Uber incurs with VAT.

The UK want Uber to add the VAT before it goes to the driver. So the £100 ride
would cost £120. Of which £20 would go the government, and the driver not pay
anything (as he is an employee).

So not only are they trying to avoid paying less VAT but they are trying to
avoid passing on the VAT to customer, making their prices seem cheaper when
compared to people that do charge VAT.

But a black cab wouldn't normally charge VAT either, since they are self
employeed and would be under the threshold.

~~~
celticninja
I'm not sure black cabs would automatically be under the VAT threshold. It is
currently £83k, so in a 6 day working week that is £270 per day. Not an
unachievable sum for a London black cab.

~~~
dalore
But how much of that is cash. If it's cash they don't have to claim all of it.
Easily putting them under the threshold.

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StClaire
I respected Uber when they started for pushing against bs regulations like,
"you're drivers need to belong to a taxi union," or "stay away from airports."

But why screw with taxes? They won't win that fight. Why not just pay
California a little bit of money to legally run their self driving cars? It'll
cost them more in salaries to have a meeting about the issue than to pay it.
And why not just deal with sexual harassment in the workplace? It's the right
thing to do

~~~
TAForObvReasons
What's the difference between the "bs regulations" like the "taxi union" and
other regulations like tax? I'm not saying one is better than the other, but
it's hard to appeal to the idea of "BS regulations" without admitting the
possibility that VAT is BS.

~~~
xixi77
Regardless of the merits of the suit, taxes are not regulations in the same
way taxi union rules are: they are a way to provide the government with
revenue. People may disagree about whether government should involve itself in
the taxi business, but as long as we have one, we need a way to fund it
somehow.

~~~
StClaire
Uber needs roads. Uber does damage to roads. Uber should help pay for the
roads.

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alistproducer2
The knives are definitely out now. The common theme is that almost all of
these monumental blunders have to have been known and approved at the highest
levels. I'm curious, what kind of leverage do VCs have on pushing for
leadership change?

~~~
jgalt212
Please, the VCs are complicit in all this.

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CarolineW
Click-bait.

It's not the ride that might cost Uber the money, it's the case that claims
they are not paying the tax they should. The fact that the lawyer used Uber to
take the ride to deliver the paperwork is ironic at best, more likely it's
just irrelevant and used as, well, click-bait.

Maybe that's what's needed to get people to spend their limited attention on
something.

~~~
ascorbic
The single ride they're referring to isn't the one to deliver the paperwork,
it's the one which Jo Maugham is suing to get a VAT receipt for.

~~~
mpeg
It's still very clickbait-y, especially as that guy is basically just trying
to get PR for his firm so he can crowdfund the money needed to sue Uber
(campaign is looking very sad at the moment with £4k out of £75k raised on day
3) and a warning that he will need to raise even more money if the case is to
go through.

