Uber has changed its driver contracts outside London to reduce its exposure to the UK’s new “taxi tax.”

The company will now act as an agent for rides outside London, letting drivers contract directly with passengers.

Drivers will charge VAT only if required, while Uber applies VAT to its commission.

The move follows government VAT rule changes that aimed to apply a 20% VAT to the full fare.

The Treasury had expected to raise up to £700 million (US$942.2 million) a year, but the revised contracts are likely to lower that figure.

Uber said fares outside London will not rise by 20%, with the changes taking effect from January 2026.

🔗 Source: The Economic Times

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