Two British taxi companies, Delta Taxis from Liverpool and Veezu from Cardiff, are launching a crowdfunding campaign to support their ongoing legal battle with Uber. This could potentially lead to higher taxi fares. The dispute centers on whether private-hire companies outside London need to pay VAT, which Uber argues would create a level playing field across the UK. The taxi industry opposes this move, claiming it could increase the cost of taxi journeys by at least 20%. The legal costs for both sides have already surpassed £1 million after several court cases in 2022, 2023, and an upcoming court of appeal case in 2024. Uber was previously forced to add VAT to rides booked through its app following a ruling in 2021, and then took legal action against Sefton council to challenge the terms for operators. Private hire companies typically classify their drivers as independent contractors, exempt from VAT payment. The industry argues that any regulatory change would disproportionately affect passengers, such as the elderly and people with restricted mobility, in areas with limited public transport options. The cab firms also claim that many small operators may be forced out of business, leaving passengers with fewer or no services. Paul McLaughlin of Delta Taxis describes the appeal as a “David v Goliath” moment, highlighting the potential impact on PHV firms using the traditional agency model. Nia Cooper, the chief legal officer at Veezu, emphasizes the importance of protecting the private hire industry and its reliance by millions of passengers. Uber believes there should be a consistent model across the UK regarding operator requirements.

Source: https://www.theguardian.com/world/2025/mar/13/taxi-firms-crowdfund-legal-battle-uber-vat-fares-uk