Star executive quit Uber as it faced pressure on UK tax structure | Uber


Uber lost one of its most successful dealmakers at a time when the company feared its position with the taxi app would undermine its tax avoidance structure, leaked documents suggest.

The leaked notes show that Fraser Robinson — one of Uber’s top executives who was based in London and led the $3.5 billion investment deal with Saudi Arabia in 2016 — was told by a senior executive that he was “going to AMS should move [Amsterdam]† Uber tried to convince British tax collectors that the company was not partially managed – and thus taxable – in the UK.

A document in the Uber files, a treasure trove of confidential files leaked to the Guardian, noted:[Robinson] refused to switch to AMS… HMRC claims that Uber’s EMEA [Europe, Middle East and Africa] earnings [are] taxable in the UK because of Fraser.”

Question and answer

What are the Uber files?

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The Uber files are a global investigation based on a trove of 124,000 documents leaked to the Guardian. The data consists of emails, iMessages and WhatsApp exchanges between the Silicon Valley giant’s top executives, as well as memos, presentations, notebooks, briefing papers and invoices.

The leaked data spans 40 countries and spans 2013 to 2017, the period when Uber expanded aggressively around the world. They reveal how the company has broken the law, duped police and regulators, exploited violence against drivers and secretly lobbied governments around the world.

To facilitate a global investigation in the public interest, The Guardian shared the data with 180 journalists in 29 countries through the International Consortium of Investigative Journalists (ICIJ). The investigation was led and directed by the Guardian with the ICIJ.

In a statement, Uber said: “We have and will not apologize for past behavior that is clearly inconsistent with our current values. Instead, we are asking the public to judge us on what we have done over the past five years. . and what we will do in the coming years.”

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Robinson, who was not responsible for Uber’s tax structure, left the company in 2017 after refusing to move to Uber’s global headquarters and tax base in Amsterdam. He is said to have resisted Uber’s request for family reasons and a source said he was already thinking of other challenges after a successful stint with the company.

A valued employee, he was described internally as the executive who “led some of the company’s most transformational deals,” including Saudi Arabia’s Public Investment Fund (PIF) investment, “which at the time was the largest private placement in history”.

The revelations also raise questions for former British Chancellor George Osborne, whose leaked documents suggest he was a private supporter of the US company’s efforts to grow its UK business, just as the company was simultaneously positioning itself to support future prospects. to avoid UK taxes.

Osborne met Uber founder Travis Kalanick at the World Economic Forum in Davos in January 2016 – just days after the company won a major UK regulatory victory when Transport for London (TfL) proposed tightening regulation of private rental vehicles. turned off.

George Osborne at Davos in 2016.
George Osborne at Davos in 2016. Photographer: Ruben Sprich/Reuters

In a leaked email titled “Davos feedback,” sent after the conference, Uber’s chief European lobbyist, Mark MacGann, said: “George Osborne is a strong supporter. He liked to believe he was responsible for the positive outcome of the TfL consultation.”

If the email reflected the reality, the British chancellor had apparently helped an American company just as it was trying to evade British taxes.

A former HMRC tax inspector suggested to The Guardian: “If seniors are based in London, there is always the risk that HMRC will claim that there are [permanent establishment] of the … company or even that the … company is run from London.

“So they may have felt exposed to a serious HMRC challenge… and needed to get their house in order quickly.”

Uber, which has made only one annual global profit for the year, had created a corporate structure similar to that of many other US companies, allowing profits to be diverted abroad – often to Amsterdam. The structures, which are legal but arguably unethical, have sparked criticism of some major US companies that employ them to evade UK taxes, including Starbucks and Google.

According to the model, passengers paid millions of pounds in fares from Uber rides in the UK directly to a payment processing company based in the Netherlands. Uber could then argue that profits made on those trips should be taxed offshore – even though the transactions physically took place in the UK – unless HMRC could demonstrate that the global company had a UK corporate presence.

Instead, the UK taxi app company mainly received its revenue from an Amsterdam sister company, which paid the London company for “marketing services” – resulting in £59.5 million in revenue and £54.9 million in costs in 2017 , according to accounts filed with Companies House.

An Osborne spokesperson said: “While the government inherited from its predecessors a tax code that meant that the tech companies paid little tax, it was George Osborne as chancellor who – with Germany – started international OECD negotiations to change that, a process that led to last year’s widely acclaimed global agreement.”

Uber said: “Uber is committed to complying with tax laws and regulations where we operate, including in the UK and the Netherlands.”

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