VEEZU: VAT TREATMENT OF PHVs
ITS TIME FOR ACTION ON THE VAT TREATMENT OF PRIVATE HIRE VEHICLE FARES
Article by Nia Cooper Chief Legal Officer
www.veezu.co.uk
Recently, I was proud to receive the Woman of the Year award at the Taxi Summit annual awards. I was shortlisted among a fantastic group of women in the sector, and I hope that the award inspires more women to join this industry. The award was recognition for the leadership and hard work in overturning the Uber v Sefton decision at the Court of Appeal back in July this year. I was proud to be part of the team that fought and reversed the original decision in a huge win for the private hire vehicle (PHV) industry.
It was six months ago that I last provided an update on the Uber v Sefton Court of Appeal success and shared my call to action for the entire PHV sector, and those associated with it, to respond to the Government’s consultation on the VAT Treatment of PHV fares.
In that six-month period, much has changed, but very little has moved on. We have a new Labour government in place, the VAT consultation closed, the Government has set out its legislative agenda, the Chancellor of the Exchequer has published the Government’s first budget, and the Supreme Court has granted Uber the right to appeal against the Court of Appeal’s decision to overturn the original Uber v Sefton decision.
OK everyone. Take a breath!
Lots of change, but we remain where we were six months ago. The Government has chosen not to act on the responses it received through the VAT consultation process, its legislative agenda contains very
10
the Supreme Court’s decision to allow the appeal means that we could be waiting another six to twelve months before we
receive a final
determination on Uber v Sefton. If the decision goes against private hire vehicle operators, then we could see an immediate implementation of 20% VAT on PHV fares.
We are six months down the line, but we are still waiting for the consistency, stability and certainty that I said we needed in my previous article.
What needs to happen?
Firstly, we need the sector to come together to fight the Supreme Court appeal. The decision granting Uber the right to appeal has ripple effects that extend far beyond licensing, raising significant concerns about tax regulation. At the heart of this legal battle is the interpretation of two lines in a 1976 licensing statute. Despite the fact that for nearly 50 years, licensing authorities, operators and regulators had applied this statute consistently without dispute, a potential new interpretation, favoured by Uber, suggested that all PHV fares should be subject to VAT at 20%, a move that risks significantly increased PHV fares.
Layla Barke-Jones writes more about this in her article on page 6-7. My message here is simple. Please engage with and support this legal battle. The future of your business could depend upon it.
little on the PHV sector (aside from Employment Rights which I will come to later) and
Secondly, while I fully support the legal process, ultimately, we need the Government to act on the VAT issue. Regardless of the Supreme Court’s decision, we may still find ourselves in a situation where VAT is applied differently depending on a private hire vehicle operator’s (PHVO) location, business model and how deep their pockets are. We know that there are differences of opinion on the best outcome for the sector and these will have been reflected in the submissions to Government’s consultation. For the good of the
the DECEMBER 2024 PHTM
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74
