Uber's tax calculation cost drivers millions

[spartaman64]

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In May, Uber admitted to taking excessive commissions out of the fares of its New York drivers, who are independent contractors, and promised to make amends. Increasing evidence, however, suggests that the company may have shortchanged the drivers by far greater sums than it acknowledged.

 

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According to data from New York City’s Taxi and Limousine Commission, Uber dispatched more than 125 million rides in the city from the beginning of 2015 to mid-March 2017. Assuming an average fare on those trips of at least $15, Uber would have deducted over $200 million for taxes and the workers’ compensation fund surcharge from drivers during that time.

The assumption of an average fare in excess of $15 appears reasonable: Uber calculated that the average fare for its lowest-cost service, Uber X, was over $27 in September 2014; it has dropped prices by about 15 percent since then. Uber also has higher-cost services, like Uber Black and Uber SUV, which have substantially higher fares on average.(The practice that Uber vowed to remedy, involving commissions, was a lesser issue. On a $20 fare that Uber said included roughly $2 in taxes, the company was taking its commission on the full $20; in late May, it conceded that it should have taken its commission on roughly $18, the amount net of taxes. What Uber does not concede is that it improperly took $2 out of the driver’s pocket to cover taxes.)

1

I guess companies would do anything to squeeze out more money. I hope there are laws against this and uber is forced to compensate those drivers and change their policies.

 

Source: https://www.nytimes.com/2017/07/05/business/how-uber-may-have-improperly-taxed-its-drivers.html 

[DoctorZeus]

This is America. if they overcharged drivers they will get shit on in court

[themctipers]

Insert political debate here. 

[imPixelTV]

Dunno about the states, but here Uber themselves have to pay for their private hire taxi plates and pay the drivers at least £7.20 an hour. I'd assume they'd have to pay all of the taxes such as London's congestion charges.

[79wjd]

I thought I read about this in may and Uber said they would reimburse drivers $5000 on average.

 

EDIT: I connfused it with another story, Uber reported that they would have to pay $900 on average, not $5000. https://www.theverge.com/2017/5/23/15681422/uber-underpaid-nyc-drivers-accounting-commission-error

[Grinners]

5 hours ago, djdwosk97 said:

I thought I read about this in may and Uber said they would reimburse drivers $5000 on average.

They were charging tax on $20 instead of $18 (for example). The discrepancy couldn't be anywhere near $5000, otherwise the average uber driver must have been paying $50,000 in tax alone. 

 

Maybe the $5000 is in relation to other parts of the dispute / other disputes? 

[79wjd]

6 minutes ago, Grinners said:

They were charging tax on $20 instead of $18 (for example). The discrepancy couldn't be anywhere near $5000, otherwise the average uber driver must have been paying $50,000 in tax alone. 

 

Maybe the $5000 is in relation to other parts of the dispute / other disputes? 

I must have been confusing it with some other story. It was $900/driver on average.

https://www.theverge.com/2017/5/23/15681422/uber-underpaid-nyc-drivers-accounting-commission-error

[HarryNyquist]

I've heard about a dozen times this week that companies like Uber and Lyft will end up being our only method of transportation in the future, when self-driving technology is advanced enough.

 

Stuff like this, combined with Uber/Lyft's business tactics and problems, makes me think that's a load of crap.

[79wjd]

16 hours ago, HarryNyquist said:

I've heard about a dozen times this week that companies like Uber and Lyft will end up being our only method of transportation in the future, when self-driving technology is advanced enough.

 

Stuff like this, combined with Uber/Lyft's business tactics and problems, makes me think that's a load of crap.

Anyone who thinks that is a moron. 

 

Roads can't handle a complete lack of mass transit and a lot of people won't want to give up control of having their own car and not having to wait for an uber/lyft to show up. And there's no way they could ever knock prices low enough to make it cheaper than owning a car for a long period of time.

[Misanthrope]

You know, so many conservatives used to point out at Kalanick as an example of a virtuous ultra capitalist and how his methods work. More and more we keep finding out how not only did his irresponsible quest to dominate the app-cab market was unsustainable but it also we keep seeing examples of how his methods often crossed into the illegal.

 

I say Uber is becoming an example of what not to do: Just because you might have an opportunity of creating a world wide monopoly or an extremely strong global position doesn't means that you should try at the expense of your own employees or the laws that directly affect the communities where they operate. Keeping customers happy with unrealistic low prices isn't a viable model.