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Taking An Uber to Work article, Sydney Morning Herald

Discussion in 'Uber Drivers Sydney (all NSW towns)' started by laser, Jun 27, 2017.

  1. laser

    laser New Member

    My response to journalist

    "You have stumbled onto a minefield of disinformation and contradiction.

    The Federal Court in the Uber case was not asked to consider the Fringe Benefits Tax Assessment Act. This is what happens in sweetheart litigation.

    Taxi travel is a term used in both FBT and GST legislation, defined for GST but not for FBT.

    The exempt FBT benefit for "taxi travel" was added to FBT in 1995. Now the ATO is saying that the exempt benefit is confined by the terms of the definition of taxi which was part of the original legislation in 1986 for the purpose of defining incidental benefits to be excluded. Work utes, taxis parked outside home etc.

    Taxi travel is defined in GST legislation (introduced in 1998) and includes travel in taxis (undefined) and limousines. Therefore "taxi" is not a defined term for GST so the Federal Court made a legislative decision to expand the scope of taxi to include ride sharing.

    Take away: the ATO cannot rely on the definition of taxi in FBT legislation inserted for purpose of defining incidental benefit to limit the ordinary meaning of taxi travel (as determined by the Federal Court) for purposes of excluding ride sharing for purpose of exempt benefit. Taxi travel is now defined by the Federal Court to include ride sharing. ATO has scored another own goal.

    This gets more fun when you look at the GST legislation. The ATO has always had a thing about the potential for the taxi industry reorganising itself into many enterprises each of which has a turnover less than $75,000. The ATO conflates taxi drivers and taxi operators whose enterprise provides taxi travel (Division 144 terminology ex Treasury). The ATO take was set out in the explanatory memorandum:
    "6.269 Other countries have addressed these problems by requiring all taxi drivers to register for GST.
    6.270 This is the approach adopted in Division 144. Taxi travel is defined in the Dictionary to include transporting passengers, by train (sic) or limousine, for fares."

    So the AT+O has been consistent and somehow no one in the ATO has bothered to read the actual legislation.

    Taxi drivers who are employees are excluded from the definition of enterprise and there is nothing in Division 144 that changes this position. It is still necessary that the taxi operator has an enterprise. In fact Division 144 does no more than ensure that any taxi operator who has an enterprise providing taxi travel with a turnover of less than $75,000 (the registration threshold) still has to register for GST. Registration for GST is always an option, regardless of turnover, and if anyone charges a fare that purports to include GST they had better register for GST or face risk of prosecution for fraud.

    The ATO has created a compliance nightmare around a paranoid fear that the taxi industry will wriggle its way out of paying GST on taxi fares. It is of concern that no one in the ATO has looked at the legislation and realised that the imposition of GST on drivers who do not carry on an enterprise is built on a house of cards.

    So back to UBER. The App is the platform, is it like Alibaba creating a marketspace for sellers to set up a stall and buyers to shop, or is it a means for UBER to conduct its business (enterprise).

    Riders have to register with UBER and set up an account linked to a means of payment, credit cared Paypal etc. UBER carries the credit risk if there are insufficient funds in the nominated account. The invoicing party is Uber Australia Pty Ltd which has an ABN and is registered for GAT (ABN lookup). UBER drivers are currently seeking to have FWO look at their status as employees. Something that has happened overseas.

    The meaning of employee under GST legislation probably is not limited by strict contractual interpretation. Master servant relationship underpins legal definition of employment, in UBER's case there is more indication of a master slave relationship. UBER drivers can either do as they are told and if not then they face exclusion, new version of whipping and starvation. Gulag, discipline enforced by team as any slacking by any member results in the entire team not eating. Nothing new in the gig economy.

    One has to ask oneself why the ATO is so keen to help Uber. Answer, it fits their narrative around taxi drivers and UBER is unlikely to pay the GST it owes to ATO as it has no assets in Australia, much easier to try an extort fees from economically vulnerable group that is unlikely to ask a few obvious questions and have the matter brought before the courts.

    Making UBER drivers pay GST on the gross fare with no credit for the fees paid to a Dutch company on which GST is not paid is a form of economic blackmail that assists UBER in maintaining uneconomic fares. Drivers have pleaded for fare increases but any response has been muted.

    I have a background in tax consulting and know what I am talking about, pleased to engage in discussion to get this out there as UBER are now threatening to exclude drivers who do not have ABN and register for GST.
     
    Uberx zoom likes this.
  2. Uberx zoom

    Uberx zoom Well known member (founder)

    Can you please post a link to that article.
     
  3. laser

    laser New Member

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