TfL Seeks HMRC Probe Of Uber Tax Arrangement
The bitter rivalry between established transport players and the young pretender Uber continues
The transport body that regulates London’s taxi and minicabs has referred the controversial Uber app to British tax officials.
Transport for London (TfL) has reported the tax affairs of Uber to HM Revenue & Customs, it is reported.
Bitter Rivals
San Francisco-based Uber has gained popularity worldwide, as its smartphone app connects passengers seeking a taxi, to a local driver or vehicle for hire. But the app has angered many established taxi and transport organisations.
They claim that the Uber system, which works out the price for the taxi journey, is tantamount to a taxi meter. A taxi meter in London can only be legally used by the capital’s famous black cabs after the driver has undergone between four and seven years of training.
Meanwhile, drivers’ unions are concerned that apps like Uber means that more and more people are contacting unlicensed drivers from private firms, who may not have had the necessary checks and training. Black cab drivers are also upset that they have to cut through a lot of regulatory red tape to become a taxi driver, and apps like Uber are undermining this.
In June, a mass protest by taxi drivers across many European cities caused traffic chaos. But Uber said at the time that the protest against the taxi-booking mobile app had backfired, after it reported a 850 percent increase in new users during the protest.
And now the bad blood continues with the news that Uber’s tax affairs have been reported to HM Revenue & Customs. The referral apparently comes after Labour MP Margaret Hodge complained that Uber’s Dutch operating firm (Uber BV) does not pay tax in the UK. She reportedly said that Uber was “opting out of the UK tax regime”.
Uber has insisted that it complies with all applicable tax laws.
Taxing Issue
The issue of technology firms and their tax arrangements has come under increasing scrutiny of late. Indeed, last week the European Union (EU) said it has launched an investigation into Amazon to determine whether a tax agreement with Luxembourg signed in 2003 breaks EU competition rules.
The Amazon investigation comes after the European Commission in June announced it had opened three investigations into Apple, over charges that the iPhone maker is avoiding hefty tax bills.
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