Uber treats its 40,000 UK drivers as separate businesses, each too small to register for VAT. As a result, Uber does not pay the UK’s 20% VAT on booking fees, saving Uber approximately £1,000 per driver per year.
In contrast, the source notes that Uber’s main UK competitors, Gett and mytaxi, both said they do pay VAT on booking fees.
Uber’s UK business, Uber London Limited, paid £411,000 of tax on a £1.8 million profit, according to the company’s 2015 report and financial statements. Critics found this unduly low, arguing that after charging UK drivers some £520 million of commissions, Uber should have paid more UK business tax.
David Plouffe, then Uber’s Senior Vice President of Public Policy and Strategy (formerly campaign manager for President Barack Obama) lobbied Chicago Mayor Rahm Emanuel as to requirements for Uber’s operation in that city — but failed to register as a lobbyist as required by law until 90 business days later. In February 2017, Plouffe was fined $90,000 for the violation.
Guided by Plouffe, Emanuel advocated the policies that Uber favored. The Chicago Tribune explains: “When aldermen [Chicago legislators] pushing for the stronger rules, which included fingerprinting drivers, tried to use a parliamentary maneuver to delay the action, Emanuel threatened to adjourn the City Council meeting. In the end, the watered-down version Emanuel preferred remained intact.”
Plouffe’s email discussions with Emanuel were uncovered as part of a lawsuit as to Emanuel’s use of a personal email account to conduct government business. In settling that lawsuit, Emanuel turned over about 2,700 pages of government-related emails from his personal account. Plouffe’s email to Emanuel is dated November 20, 2015 – pages 127-129 in this archive.
Various Uber drivers have attacked passengers. Representative examples: In March 2014, a Chicago passenger sued Uber after her driver locked the car and groped her. In June 2014, a Los Angeles driver kidnapped a woman who had passed out in his car.
In an internal crisis communication message that was accidentally made public, Uber CEO Travis Kalanick blamed the media for suggesting that Uber was liable for driver misconduct.
In response to an internal review, Uber fired 20 employees for harassment, discrimination, and inappropriate behavior. 31 other employees were undergoing further training, and 57 additional complaints remained under review.
The California Public Utility Commission found that Uber violated CPUC “zero-tolerance” rules in its handling of 151 complaints, failing to suspend and/or investigate the drivers. In only 22 of 154 complaints did Uber suspend the driver within one hour of a passenger complaint. Furthermore, some of the supposedly-suspended driers were nonetheless able to log in to Uber, respond to ride requests, and provide additional rides.
CPUC further found that, contrary to CPUC rules, Uber failed to implement a “zero tolerance” policy that immediately suspended a driver for a DUI allegation. Instead, Uber’s process had multiple steps and multiple opportunities for error by Uber staff. In contrast, CPUC rules required Uber to suspend the driver before verifying the validity of the complaint.
CPUC also found limited evidence that Uber followed up with passengers to investigate allegations, including Uber failing to follow up in several hours or even a full day after a passenger’s complaint.
In light of these practices, CPUC recommended a penalty of $1.1 million.
Pittsburgh Mayor Bill Peduto, previously an Uber zealot, told the Wall Street Journal that he had become disillusioned with the company. Peduto wanted Uber to give more back to the city, including hiring local talent, providing better work conditions for Uber’s drivers, improving fuel efficiency, expanding service to elderly residents, and supporting the city’s federal grant applications.