Cardiff headquartered taxi firm Veezu has defeated an appeal by global tech giant Uber to the Supreme Court that would have seen a steep rise in taxi fares across the 海角视频.
With VAT on taxi fares applying in London since 2021, Uber - which operates a global taxi hire app - took a case against Sefton Council to the High Court in July 2023, arguing that private hire vehicle firms such as Veezu operating outside of London and Plymouth, should also have to charge VAT.
In its decision the High Court interpreted a 1976 licensing law to mean that private hire operators must form contracts with passengers - making them VAT liable. The ruling was overturned last year following a successful joint legal challenge by Veezu and Liverpool-based taxi firm Delta to the Court of Appeal.
Silicon Valley headquartered Uber than appealed the decision to the Supreme Court. In an eagerly-awaited judgment the five judges on the Supreme Court unanimously rejected Uber鈥檚 case in a huge legal victory for Veezu and Delta acting for the wider 海角视频 private hire vehicle sector. It means firms can continue to operate under the 鈥榓gency鈥 and 鈥榠ntermediary鈥 models with drivers with no VAT being charge.
The charging of VAT on passenger journeys, as well as seeing an increase in customer fares of 20%, would also have resulted in the reorganisation of the internal systems of taxi firms and revisions to contracts with their driver partners.
Welcoming the Supreme Court ruling chief legal officer at Veezu, Nia Cooper, said:鈥淭his decision is a triumph for the 海角视频 private hire vehicle sector. The unanimous verdict ends a three-year legal battle and confirms that operators can continue to choose which business model they adopt to run their business.
"Uber, was seeking a declaration that would have resulted in 20% VAT being charged on all private hire vehicle fares.
鈥淭his outcome protects these often vulnerable passengers from crippling fare increases, avoids undue burdens on licensing authorities, maintains the status quo for licensed private hire vehicles drivers and allows the private hire sector to keep serving the people and places that rely on it 24/7.
"This ruling also shows that British-owned businesses can stand up against global giants that attempt to use litigation as a tactic to shape the sector to suit their business model.鈥
Cardiff-based Capital Law acted for Veezu.
Carrie Jones, principal associate at Capital Law, said: The Supreme Court鈥檚 judgment affirms the legality of the different models operated by private hire operators throughout England and Wales (excluding London and Plymouth), which had been called into question by Uber.
It is an excellent result, and one which will be welcomed by the industry.鈥
Uber will now be liable for the legal costs incurred by Veezu and Delta.
Veezu was founded in 2013 by its chief executive Nathan Bowles and now operates 海角视频-wide following a series of acquisitions.
The company directly employs 550 staff and partners with more than 12,500 self-employed tax drivers across the 海角视频 who handle more than three million passengers annually.
