Mersyside’s Delta has joined forces with Cardiff-based Veezu to take tech giant, Uber to the Supreme Court.
The taxi firms have launched a “fighting fund” to stop a ruling that could drive fares up “by at least 20%.”
In July, they will face Uber for a fourth time, having already gone through the High Court and Court of Appeal as Uber seeks a ruling which would affect whether VAT applies to taxi firms outside of London.
In 2021, Uber was forced to add VAT to rides booked through its app, because the High Court classed the operator as a contractor, rather than an agent. Historically private hire vehicle companies have been able to call their drivers independent, self-employed contractors, so therefore they do not pay VAT.
It’s this which Uber is challenging.
Delta and Veezu said adding VAT would “overturn decades of legal precedent” and should they win “ millions of passengers, especially those in rural areas, low-income communities, and those with limited mobility, will face unaffordable price hikes.”
The companies fear that smaller taxi firms and self-employed drivers could be “forced out of business.”
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“This court case could have massive repercussions for PHV [private hire vehicle] firms like us using the traditional agency model, which has been part of British culture for generations. If Uber win, it will add at least 20% to the cost of a private hire taxi fare outside of London and it will unfairly penalise passengers, taxi drivers and every other private hire firm in England and Wales. There are thousands of traditional private hire taxi firms just like us up and down the country, so the impact will be felt far and wide,” said Paul McLaughlin, a Delta Taxis spokesman.
“This really is a David vs Goliath moment – in this case we’re representing our entire industry and a Great British institution, as well as the best interests of taxi drivers and passengers. The potential cost of these changes could be devastating for so many people – we simply cannot let Uber win.”
They have set up a £500,000 “fighting fund” to support the legal battle and said costs have already exceeded £1m after the earlier High Court cases in 2022 and 2023, and a Court of Appeal case in 2024.
The crowdfund will see all the money being used to help fund the campaign.
“This case is about protecting the future of the private hire industry and the millions of passengers who rely on it every day. The private hire industry is integral to the transport network in UK and provides essential journeys to passengers, particularly those that are vulnerable. It is often the only form of transport accessible to local communities on a consistent and reliable basis,” added Nia Cooper, Chief Legal Officer at Veezu.
“The ruling sought by Uber would impose a VAT burden on the rest of the industry that would create unfair competition across the sector and disregards the long-established structure of private hire firms. If upheld, vulnerable passengers, drivers, and established British PHV businesses will be caught in the crossfire of Uber’s commercial ambition. That is why we are taking a stand to preserve choice, affordability, and the independence of private hire operations across the country.”
Layla Barke Jones, Dispute Resolution Partner at the law firm Aaron & Partners, who represented Delta Taxis in the court cases to date and will represent them in the Supreme Court, stated:
“The Court of Appeal judgement was a victory for the taxi industry and all those who depend on it, but Uber’s decision to make the final appeal means we need to go to the Supreme Court to take up the fight once again. There has always been a shared aim to protect passengers, drivers and taxi firms alike throughout this case.
“We believe it is the most vulnerable people in our communities who depend on these taxis that will be hardest hit, such as those with disabilities, low-income households and older people. It’s down to us to stop that happening.
“There’s a lot at stake whichever way you look, but it’s our hope that we can once again block this move by Uber and protect the operators, drivers and passengers who rely upon traditional taxi firms.”
In response Uber said that it believed “there should be consistency throughout the UK.”
