An Employment Tribunal has decided that Uber is supplying transportation services. The consequence of that decision is that Uber should be charging VAT to customers and paying it to HMRC. And that will be true not just now but for the whole period for which Uber has operated in the UK, a period of longer than four years.
An Advocate General at the European Court of Justice has also said Uber is supplying transportation services. And I think those decisions are right. And I am a QC specialising in tax, so this is a view I am entitled to hold. I have also taken formal advice from another QC who specialises in VAT.
Err, no, not really, it doesn’t follow. Definitions in different parts of the law are different, no?
And the VAT liability is upon the individual river at present, no? Whether they are registered etc?
There being a useful little test. There are other (and older) methods of booking a cab through a central billing operation. How do they deal with VAT?
And international agreements that limit them?
A very substantial source of avoidance – practised by the usual suspects, Google, Facebook, Airbnb and others – involves selling into the UK from tax havens abroad. We should tackle this with a Foreign Sales Levy on large companies who engage in that practice. Base yourself here and you can pay corporation tax – but if you choose to game the system by selling to UK customers from tax havens you will pay a substitute for the corporation tax you are dodging.
Of course, a tax on corporate turnover throws up unfairnesses but – a universal answer to those who complain about measures that combat tax dodging, this – those unfairnesses are the consequences of choices made by taxpayers. If you don’t like the turnover tax, operate from within the jurisdiction.
But quite aside from this it hard to understand why our tax system should prefer the wealthy to higher earners. The trend should be to cut taxes on income and increase taxes on wealth.
Because the entirety of tax efficiency theory says tax income not wealth.
Why are taxes on earned income considerably higher than taxes on the income fruits of wealth? Bring the latter up to the level of the former – not at all difficult to do – and we would generate very substantial additional tax receipts and in a rational and progressive fashion.
Ditto, there are libraries full of this stuff, Nobels have been awarded for it.
But what if the status of the 1972 Act was outside Parliament’s hands?
That’s a topical question because Parliament is just about to be asked to agree to repeal the 1972 Act in the European Union (Withdrawal) Bill.
The very first clause of that Bill says:
The European Communities Act 1972 is repealed on exit day.
And “exit day” is defined as “such day as a Minister of the Crown may by regulations appoint.”
Yep, that’s right. The government is proposing that a Minister gets to decide when our membership of the EU ends. And to make that decision without any Parliamentary control at all. None, zip, nada.
The consequence of Parliament agreeing to this clause is stark.
If talks do break down, it will be a Minister of the Crown – Boris Johnson, say – who has absolute unfettered discretion as to how to react. Parliament – our sovereign and democratically elected Parliament – will be completely sidelined from the most important decision our nation has made in recent times.
Giving unfettered power to a Minister, marginalising our Parliament, in respect of such an important decision is the very opposite of taking back control.
Parliament must vote against clause one.
You do recall all of his protests about regulations and directives flowing from Brussels, to be enacted, variously, either by mandate or SI? Yes? You do recall all of his protests about that?
On Twatter, so I can ‘t reproduce it exactly, I’m blocked. But:
Let’s be clear. Staying in the Single Market and Customs Union are key steps in avoiding an economic breakdown that could deliver fascism.
Almost makes you wonder how we managed in 1940 without being part of the European superstate of the day, doesn’t it?
But I can ask HMRC to exercise its discretion to allow me to claim the £1.06 of input tax I say I paid to Uber even without a VAT receipt. And earlier today I did. You can read my letter here HMRCInputTaxLetter.
Now, why is that important?
Well, if HMRC decides to allow my claim it will be accepting that I have paid £1.06 input tax to Uber and, implicitly, that it has to collect that £1.06 from Uber. And if that is true for my £1.06 it will also be so for every other £1.06 Uber has ever charged.
And if HMRC decides to refuse my claim I could have the opportunity to appeal against that rejection and contend that, contrary to its decision, I have paid input tax to Uber. And if I won that appeal the tribunal would be deciding that Uber has charged VAT and, implicitly, has to pay that VAT to HMRC. Along with all the other VAT Uber has charged.
And that appeal would be heard before the First-tier Tribunal (Tax Chamber). I would be the Appellant, HMRC would be the Respondent and Uber would be grumbling in the back of the room. And, unlike in the High Court, in the Tax Chamber the loser doesn’t have to pay the winners’ costs.
So, he’s willing to make us taxpayers carry the legal bill for his fantasies, is he?
Standing against Her Godnessness in Maidenhead perhaps.
Pity he doesn’t do it actually.
So we throw a party. A joyous, optimistic thing. Not political. Celebrating unity. 28 days long, each day ‘hosted’ (food, drink costume) by one of the member states. We have bands, and comedians, and writers, and thinkers, and artists, and designers.
And to deliver focus, and urgency, and to frame the contrast with the nation at large, and to make the party a national event, we stand a candidate (Jo Maugham QC) in Maidenhead against Theresa May. Jo has a good national media profile as a campaigner against tax avoidance and on Brexit.
Because the entire costs of the 28 days of parties come out of his allowable election expenses.
Why is that these clever people who think they can plan national life can’t in fact plan their way out of a wet paper bag?
Here we are.
I’m proud to be with you. And I’m proud to have walked with you. And I’m proud to stand with you. And I’m proud to talk to you.
Because when we work together, when we share our wealth, we all prosper. When we live as a community, all our lives are better. When we stand together we are all protected.
Next week will also see the next step in our case to establish that Article 50 is just the beginning of a journey. We have new additions to a very powerful legal team. We will file our written case. We will seek a hearing date in June. Ireland has said it wants to discuss the way forward.
The Claimants – me along with three very brave politicians from the Green Party who came forward when no one else would – are bringing this action to give the people of this country a choice. A choice they must have. A democratic choice. To remain if they want to remain.
Whut? A referendum and an Act of Parliament are not democracy? As Ironman points out.
And now Jolyon Maugham is bringing a case against Uber demanding a VAT receipt for a journey he made in a car provided by that company. He knows, of course, that he won’t get one. Uber claims it does not provide taxi services, saying its drivers do that and it is a mere booking agency. But that claim is inconsistent with the facts, which have been upheld because Uber drivers have been found to be employees in a tribunal hearing.
No, they haven’t, they’ve been found to be workers.
A leading tax lawyer is planning to challenge Uber in the courts over what he alleges could be a £20m-a-year black hole in its tax payments in the UK.
Jolyon Maugham QC said he was preparing to submit a case to the high court that would argue the US taxi app company should be paying VAT on fares, which he estimated would total almost £20m for 2015.
Lawyers tend not to work for free after all.
Think he might have a hole in his reasoning too. He’s supporting the claim with he idea that drivers have worker status, thus it’s Uber providing the transportation. But UK law distinguishes between worker and employed status…..
Still, the way I read this is as with The Spud. Let’s do some agitating in order to gain ermine. The QC deciding to avoid, in my opinion of course, the hard work and low pay of being a judge along the way.