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Australia levies 10% GST on Uber taxi drivers

  • May 19, 2015 | Richard Asquith

Australia levies 10% GST on Uber taxi drivers

The Australian Tax Office has ruled that Uber drivers are classified as a taxi service, and therefore liable to Goods & Services Tax. This will require any driver earning any income for ride sharing to tax register, and charge 10% Australian GST on their rides.  They will report and pay the tax through filings with the ATO.

The ruling issued by the ATO was part of a wide ranging briefing on the 'sharing economy'.  It will also extend the GST net to other peer-to-peer services like room renting.  Providers of such services will have to register for GST once their annual turnover exceeds AUS$ 75,000, which is the general threshold.  Ride-sharing will require immediate GST registration.

Uber has announced that it will challenge the ruling, which will affect almost 10,000 drivers. The tax rise in theory should be added on top of the drivers fee; however they may chose to absorb some or all of the charge to remain competitive. Uber drivers can still legitimately avoid some of the public liability insurance obligations of publically registered taxi drivers.

Uber charges them a 20% fee for their referral service.

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which won International Tax Review's 2020 Tax Technology Firm of the Year. Richard trained as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.