ALL THINGS LICENSING
Article by Mike Smith, Senior Specialist for Licensing and Community Safety at Guildford Borough Council and Vice-Chair of the Institute of Licensing South East Region.
Please note that this article represents my own views which are not presented as the views of the Institute of Licensing or Guildford BC.
PHTM Expo
Firstly, I want to thank the PHTM team, exhibitors and attendees for an excellent Expo in Milton Keynes. I thoroughly enjoyed my time on the Institute of Licensing stand and being part of the seminars discussing licensing matters; and am looking forward to next year.
Barely a week had passed since the Expo with the Prime Minister’s announcement of a general election on 4th July. From a licensing perspective this means that Parliamentary time will have run out, so there will no national minimum standards or enforcement powers, and whichever party forms the next government, it will need to either pick these up or may wish to go back to the drawing board.
VAT Treatment of PHVs Consultation
Another issue which will rollover, which formed the basis of some of the seminars, and many of the conversations at the Expo, focused on the govern- ment’s consultation regarding the potential tax impacts of the Uber Britannia Limited v Sefton Borough Council High Court judgment on the private hire vehicle sector.
The consultation started on 18th April, running until 8th August and invites views on potential government interventions that could help to address any adverse tax effects on the private hire vehicle sector and its passengers.
In last September’sPHTM, I examined the licensing implications of the Uber and Sefton judgement and clearly the subsequent consultation on mitigating the potential taxation impacts of the judgement is generating considerable interest from many in the sector. There are others whom are far better
6
qualified to comment on taxation matters and so consequently I wanted to examine the licensing implications arising from the consultation.
Initially I thought this was a consultation about tax matters, which most licensing authorities will generally wish to
steer well clear of, and
subsequently, the consultation apparently does not seek views from regulators, which for reasons that will become obvious later on is absolutely astounding. As such, I would urge anyone with an interest in the trade to ensure they have read the consultation thoroughly and respond.
The consultation begins by setting out some back- ground information about the sector and the judgement. It emphasises that the implications only apply to the PHV trade which may need to adjust their business model following the judgement, and not the hackney trade. The first question enquires about the background of responders, asking if they are a consumer, operator, driver or representative body and subsequently in which authority they may be licensed.
The consultation continues by looking at the potential implications on both operators and customers following the judgement. Ultimately, if the original judgement is upheld and operators will all have to act as principle and contract with passengers, there are potentially widespread implications for both in terms of VAT treatment of PHV journeys. The consultation acknowledges that London-licensed operators will already be subject to VAT treatment following earlier litigation, and continues that operators paying VAT under the Tour Operator Margin Scheme should not do so.
Initial analysis in the document suggests that one- third of the PHV market is still currently operating under the agency model, with an estimated increase in fares of around 1.25% to 2.5% across the whole market, when averaged with the other segments of the private hire and taxi market. This would equate to an increase in fares of around £2.70 to £5.60 per year for the average passenger. However, this estimate seems to be based on an average use across the sector of a passenger using a mix of taxis and PHVs whose operators use different models. Therefore a passenger who currently uses an operator acting as an agent who
JUNE 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 |
Page 75 |
Page 76
