Uber Loses Appeal: No VAT for Rival Taxi Operators Outside London

Uber's appeal to impose a 20% VAT on rival taxi operators in England and Wales, similar to its own, was dismissed by the Supreme Court. This decision clarifies the contractual differences for operations inside and outside of London. The ruling also impacts other firms like Bolt amid ongoing regulatory discussions.

In a significant legal ruling, Uber's bid to extend a 20% Value Added Tax (VAT) obligation to its rival taxi operators in England and Wales failed. The Supreme Court dismissed the ride-hailing firm's appeal, confirming that operators outside London are not required to enter contractual agreements with passengers, unlike the firm's arrangements in London.

The case's origin traces back to a 2021 judgment that classified Uber drivers as workers, elevating them to a status eligible for minimum wage and holiday pay, thus subjecting Uber rides to VAT. Hoping to level the playing field, Uber had argued for rival firms outside the capital to enter similar contractual obligations but saw the High Court's supportive ruling overturned by the Court of Appeal in July 2024.

This latest ruling highlights the complexity of regulatory environments in different regions of the UK. Kimberly Hurd, from Bolt, called for a unified regulatory framework following a similar victory against HMRC, which plans to contest their VAT obligations. The ongoing legal contests underline the evolving landscape of ride-hailing regulations in the UK.

(With inputs from agencies.)