TRANSPARENT FARES: Union warns private hire drivers must not carry burden of potential 20% VAT on fares
- Perry Richardson
- Sep 25
- 2 min read
The App Drivers and Couriers’ Union (ADCU) has called for full fare transparency following reports that the Chancellor may announce a 20% VAT charge on all private hire vehicle (PHV) fares in the Autumn Budget.
Cristina-Georgiana Ioanitescu, President of ADCU, said that if the tax is introduced, app-based operators such as Uber and Bolt must be required to open up their fare-setting systems to scrutiny. She argued that the algorithms used to calculate fares remain hidden from drivers and need to be made public for full transparency.
The union also called on the Government to address issues of self-employment within the forthcoming Employment Rights Bill. Ioanitescu warned that without legal recognition of worker status, PHV drivers could be left exposed and forced to shoulder the costs of the VAT changes. She stressed that responsibility for any VAT increase should sit with operators, not individual drivers.
The ADCU’s comments follow months of speculation that the Treasury may seek to introduce VAT on all PHV journeys as part of wider reforms to raise revenue. At present, operators outside London using certain business models avoid applying the full 20% VAT charge, a position challenged by rivals and tested in several court cases involving Uber.
The union has pressed for stronger protections for drivers, highlighting falling pay rates and rising costs of living. Ioanitescu said that the combination of higher fares for passengers and the threat of reduced driver income under VAT reforms made government intervention essential.
The Autumn Budget is expected to provide clarity on the Government’s stance, with the ADCU warning that drivers should not be left to absorb additional financial pressures if major changes are made.
Ioanitescu said: "If, as is widely being reported, the Chancellor announces an across-the-board 20% VAT charge on all PHV fares in the Autumn Budget, then it is critical that the app companies, including Uber and Bolt, are finally required to make public the algorithms they use to calculate fares, which are currently hidden from drivers, for full transparency.
"ADCU is also pushing the Government to address bogus and forced self-employment for PHV drivers within the Employment Rights Bill, specifically in relation to worker status. By taking action to protect our members, via worker status, the government can ensure that they are not placed at risk of shouldering the responsibility for any changes to the VAT regime, which lies firmly with the app companies."
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