After a meeting of world leaders to set global rules on multinational tax avoidance, an alliance of groups estimated that Uber avoided $ 6.4 million to $ 12.8 million in corporate taxes in New Zealand alone in 2020.
The report from the Center for International Corporate Tax Accountability and Research (CICTAR), FIRST Union and E tū shows how Uber employs a network of more than 50 Dutch mailbox companies and uses other tax havens like Bermuda, Delaware and Singapore to protect it. Billions in tax payments for its global operations.
“New Zealanders should be concerned about how multinational corporations like Uber, which rely so heavily on investments in public infrastructure like roads and hospitals, are clearly evading their tax obligations,” said CICTAR principal analyst Jason Ward.
“Uber’s estimated tax gap of $ 6.4 million to $ 12.8 million in 2020 is money that could have been spent filling hospital wards or training apprentices. Instead, it was shot in Uber’s multi-billion dollar Dutch tax protection, which will enable the company to avoid billions in corporate taxes as its business continues to expand.
FIRST’s strategic project coordinator Anita Rosentreter said the report highlights the dangerous effects of gig economy firms.
“Uber’s business combines an exploitative work model that deprives workers of their rights, with a global tax structure that deprives the public sector of the tax revenues that we all depend on to keep our society alive,” said Rosentreter.
E tū director Kirsty McCully warned that the expansion of the gig economy would lead to even more losers if not questioned.
“More and more app-based multinationals are popping up in Aotearoa and they’re all turning to Uber to see what they can get away with,” McCully said. “We must not allow these corporations to continue neglecting our country and shirk their responsibility – be it towards our country or their workforce.”
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E tū and FIRST Union are taking legal action against Uber, demanding a statement from the labor court that Uber’s workforce are employees and not independent contractors.
“This is a matter of principle and important for workers everywhere – a large global corporation like Uber should not benefit from denying workers their rights,” said Rosentreter.
“Companies that do business in New Zealand must at least pay taxes and respect our laws, just like everyone else.”
The report comes as 137 OECD / G20 countries and jurisdictions this month finalized the inclusive framework for soil erosion and profit shifting, which aims to reform international tax rules and ensure that multinational corporations have a fair share wherever they operate to pay taxes.
The report was presented to Ministers David Parker (Revenue), Stuart Nash (Economic Development) and Michael Wood (Workplace Relations).
You can find the full report here.