Uber app 'competing unfairly', Margaret Hodge claims
- 1 August 2014
- From the section Business
The Uber taxi app is "competing unfairly" with London's black cabs, senior Labour MP Margaret Hodge says.
She has written to Boris Johnson asking why Transport for London allows cars to take bookings through the app without a licence to operate in the capital.
Mrs Hodge claims the firm is "opting out of the UK tax regime" but Uber said it complied with "all applicable tax laws".
Thousands of taxi drivers protested against the app in June.
The smartphone app works out the cost of fares using GPS. Cab drivers say it is similar to using a taxi meter, which only they are legally entitled to do.
'Impact on livelihoods'
The app's Dutch operating company, Uber BV, does not pay tax in the UK - but Mrs Hodge said TfL could insist that it does so.
She said: "I am particularly concerned about the tax structure that Uber and others have apparently constructed and the impact this has both on the public purse and on the livelihoods of London cabbies and private hire drivers.
"This structure allows these new entrants to unfairly undercut London operators by opting out of the UK tax regime.
"TfL allows this to happen by failing to apply the appropriate regulations to Uber."
In the letter to Mr Johnson, the mayor of London, Mrs Hodge, who chairs the cross-party Commons Public Accounts Committee, added: "Surely TfL has a duty to enforce legislation that will ensure a fair and level playing field for all taxi and private hire operators?
"I would be grateful if you could set out the steps you will take to ensure that TfL does not inadvertently allow tax avoidance in London and that all taxi and private hire drivers receive a fair deal."
She has been backed by the Licensed Private Hire Car Association (LPHCA), which represents 20,000 cabbies.
LPHCA chairman Steve Wright said: "London's taxi and private hire industries are being compromised by inconsistent licensing enforcement by TfL and the apparent ability for app-based operators like Uber to operate through an offshore tax regime.
"As well as the loss in revenue to the country, a whole industry that has a wonderful compliance record - unlike some of these new apps - is being undermined by foreign entities, working the UK tax system for corporate greed."
But an Uber spokesman said: "Uber complies with all applicable tax laws, and pays taxes in all jurisdictions, such as corporate income tax, payroll tax, sales and use tax, and VAT.
"Uber London Limited is a licensed private hire vehicle operator and recently passed the largest inspection of records ever conducted by TfL."
Chief operating officer at TfL Garrett Emmerson said he was "fully satisfied" the app was operating lawfully.
He added: "TfL's role is to licence and regulate the taxi and private hire industry in London. We do not have any powers in relation to an operator's corporate structure and how or where they pay tax."