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VAT ADDED: Other Private Hire Operators must now change models to comply with law too says Uber

Uber have urged thousands of other private hire operators to follow suit by making changes to their business models, after making changes which includes paying VAT on all UK journeys.

Earlier this month Transport for London (TfL) had warned ALL Private Hire (PH) Operators to take ‘IMMEDIATE ACTION’ to make changes to their terms and conditions and ensure compliance.

The warning follows a recent High Court judgment that ruled London PH Operators should contract directly with passengers in the interests of public safety. Operators must also ensure that passengers have appropriate legal recourse in the event that something goes wrong during a private hire journey.

Uber’s operating licence is set to expire on 27 March and the ride-hailing firm have done their best to meet changes required by TfL. As of this week all journeys on the Uber platform is now subject to VAT.

An Uber spokesperson told TaxiPoint: “We have completed the changes to our business model as required by law. Other operators in London are also required to make changes to their models to comply with the relevant law.

"Uber operates in an intensely competitive market and we are committed to always offering consumers affordable prices. As always, riders will get a trip price before booking their journey.”

Uber and regulators TfL now seem eager for ALL operators to follow suit quickly.

In a Notice released earlier this month, TfL’s Taxi and PH General Manager, Graham Robinson said: “Just over three months have passed since the judgment was given and by now all London PHV operators should have reviewed any terms and conditions and considered whether any changes are needed. Some operators may have already made changes and others may be in the process of making changes.

“We have contacted the largest operators as well as those with imminent licence renewals since the Court’s judgment was given to ensure both that they are aware of the judgment and that they are taking steps to ensure compliance.

“We plan to publish guidance to help operators better understand the judgment, its implications and what is needed to comply with it. We will also look to publish FAQs covering some common questions we have been asked.

“We also plan to make a new regulation that will require all licensed London PHV operators contract as principal with the person making a PHV booking to provide the journey which is the subject of the booking.

“Operators should satisfy themselves that they are compliant and take appropriate advice, where necessary, to ensure compliance.

“We expect all operators to take immediate action to make any changes to their terms and conditions and ensure compliance, where they haven’t already."

One area of debate which focuses around the thorny subject of workers' rights however remains open.

In an open letter to the Mayor of London, the App Drivers and Couriers Union (ADCU) are demanding that regulators TfL set tough worker rights conditions on Uber's application for the renewal of their licence to operate in London.

The union argues the ride-hailing operator has failed to abide by the Supreme Court ruling of February 2021 to pay drivers at least minimum wage and holiday pay from the period of log on to log off. Instead, Uber pays only for the period of dispatch to drop off, which effectively means that drivers are paid nothing for about 50% of their working time at Uber. A new 5 day hearing scheduled at the Employment Tribunal in June this year is scheduled to decide working time for Uber drivers.

How the forthcoming Employment Tribunal hearing affects TfL’s decision to grant Uber a new licence is yet to be seen.


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