Archive for category: General News

Uber London Ltd has recently come under fire as the company’s accounts show they paid no corporation tax on profits made on the UK for 2014.

Uber have come forward to defend this stating that the low rate of tax is due them offsetting previous losses which is a legal practise.

In 2014 Uber London made £866,302 profits all of which, according to the company’s accounts, they paid no tax for. The company did however book £22,134 tax charge for the year and a spokesman claims was ‘deferred taxation relating to previous years’.

Sources say that The Independent had an accountant look at the books and they found that the company’s corporation tax was in effect ‘cancelled out’ due to the deductions they had for the costs of exercising share schemes with their employees. Employees making use of the share scheme would pay income tax and National Insurance of around 47 per cent which in turn provided the company with a deduction on corporation tax resulting in a zero figure.

A spokesman for Uber has denied that the company has used any loopholes or schemes to reduce its tax bill and claimed that Uber had paid “every penny of tax that is due”. “With corporation tax, past losses offset current and future profits – as is the case with Uber which made losses in the UK in previous years,” he said.

“This is an accounting principle to encourage investment that dates back to Benjamin Disraeli. It is not a loophole.”

“We are a young company – only three years old in the UK – that is investing heavily”.

“We are a significant net contributor to the local economy everywhere we go, creating new opportunities for thousands of professional drivers”.

“The lion’s share of every fare stays local, as it remains with the drivers who use Uber. And unlike the cash-in-hand past of this industry, we only take card payments so every fare is traceable and transparent.”

Multinational corporations have recently been under fire for exploiting loopholes and schemes to pay less tax such as Facebook who paid just £4,327 corporation tax in 2014.

Richard Branson says that Taxi drivers must ‘accept that there is a new model in the industry and says that one day his company ‘may set up an alternative’

The billionaire says that his company should be competing with the likes of Airbnb and Uber, adding that ‘it is ridiculous how well Uber is run’ and that ‘you cannot stop progress and can’t turn the clock back’.  Sir Richard was an early investor in Uber, and has also put money into their rival Hailo. Hailo have only recently announced that they have moved away from supplying Private hire vehicles to after much outrage from London’s Black Taxis. He has spoken many times about the benefits of disrupting a market ‘that has remained unchanged for many years’

Uber has been banned in a number of cities across the world over fears that it is anti-competitive, as this allows drivers to charge lower fares than traditional cabs.

It is believed that Transport for London is currently considering proposals that would hit Uber hard, among these proposals is thought to be a minimum wait-time of five minutes between ordering a minicab and it arriving, and a requirement that operators must not show vehicles being available for immediate hire either by sight or via an app.  Currently Uber matches it’s passengers with drivers in their immediate vicinity, showing availability on its app, and on average users wait three minutes for a car, so both these proposals would be a blow to them.

Uber has reported that this crackdown could cost it’s drivers a total of £19m per year.

 

The Knowledge School on Caledonian Road, Islington, is set to close next month after 30 years of teaching trainee drivers ‘The Knowledge’ which drivers need to complete to qualify as a licensed black taxi driver in London, and which consists of routes through the City’s 25,000 streets.

The closure follows the introduction of Uber drivers, who are in direct competition, and this has seen numbers of students decline from around 350 a year to 200 last year.  The school was started by Mr Linskey thirty years ago, and he said that the school would continue to produce printed and online teaching material, and hoped to run training sessions in local centres and church halls.

Mr Keefe, a student at the school said that he was certain black cabs would continue even in the face of such competition, and told the Financial Times ‘Quality prevails, We’ll win out’

Uber have won the latest skirmish in the ongoing battle between the London Black Taxi drivers and UBER.

The high court were asked by TFL to decide whether the company’s smartphones were considered meters, which by TFL’s own legislation are considered illegal in a Private Hire vehicle.

The court ruled in UBER’S favour as Mr Justice Ouseley declared that the taximeters operate differently to Uber as they do not depend on GPS or include the app’s other characteristics when calculating fares.

Both Transport for London and Uber had argued that the apps was not a meter with many black Taxi drivers disappointed that TFL did not leave it solely with the courts to decide the outcome. Some Taxi drivers had said that if the High court had found that the meter was illegal it would have left the management which is already under fire pushed out of management positions within TFL.

The LTDA within an hour of the ruling had said they would appeal the decision.

An LTDA spokesman said, ‘’the smartphone works in exactly the same way as a taximeter calculating fares by distance and time, it does exactly the same job.

The Licenced Private Hire Car Association (LPHCA) also backed the London Taxi Drivers Association in its opposition to the way UBER calculated it’s fares.

 

The next battles

Transport to London are currently undergoing a consultation on Private Hire regulation and have proposed the following changes to the way Private Hire vehicles operate:

•  Specific requirement for a English language test
• Training for Private Hire vehicles (a watered down version of the Knowledge)
• Operators must provide a specified fare prior to booking being accepted
• Fixed landline must be available at all times
• Minimum 5 minute wait between booking and vehicle dispatch.
• Ban on ride sharing
• Possible limit in the number of Private hire vehicles (2 years ago 1 in 100 vehicles in the congestion zone were private hire vehicles, now 1 in 10 are said to be private hire vehicles)

The above changes will have a significant impact on the way Uber operate and within hours of the proposals being leaked UBER had launched an online petition which currently stands at over 133K opposing the proposals.

Ubers Jo Bertrum’s said ‘’Compulsory five-minute waits and banning ride-sharing would be bad for riders and drivers, these plans make no sense.’’

Uber also announced the launch of UberASSIST an initiative that helps people with disabilities access their vehicles, this is likely to be another kick in the teeth for the London Taxi trade.