Uber should be recognized as 'distinct service,' company says

Quebec legislation expected to include stricter tax rules, licensing requirements

CBC.ca
April 29, 2016
By Benjamin Shingler

The general manager for Uber Quebec says the provincial government's coming legislation should recognize the ride-hailing service has a "distinct model" in comparison to the taxi industry.

Jean-Nicolas Guillemette says Uber will halt operations in the province if the new rules go too far.

"The goal is to stay here and offer the same service we've been offering for two years," Guillemette told CBC Montreal's Daybreak on Friday.

The legislation, which is due to be tabled May 12, is expected to include stricter licensing fees and force the company and its drivers hand over more tax revenue.

"Clearly, what [Transport Minister Jacques Daoust] wants to do is to shut us down. The way he wants to regulate us is the same as the taxi industry is regulated," Guillemette said.

Debate over sales tax

As it stands, the company does not require drivers of its most popular service, UberX, to have a tax number for GST and Quebec sales tax collection.

Drivers for the service are treated as independent contractors and aren't required to have a taxi licence.

Daoust has said both the company and its drivers have a responsibility to fully declare their revenues and if they comply, the company won't have to leave.

"If they want to respect the laws, if they want to pay taxes then they are most welcome," Daoust said earlier this month.

On Daybreak, Guillemette said the majority of Uber drivers in Quebec - about 75 per cent - work less than 20 hours a week and therefore don't make enough annually to register and collect tax.

"There is a tax exemption if you make less than $30,000 and this is what we are doing," he said.

"If the government wants to change that, we are definitely open to collaborating on that."

Guillemette added that UberX drivers shouldn't be required to pay for a permit or it wouldn't be worth it.

"When you drive five to 10 hours for a few weeks on the platform for a few weeks because you need to pay your bills, if we are asking you for example to pay $300, they won't do it," he said.

Profits moved to the Netherlands

Uber has also drawn criticism for its corporate tax structure, with some accusing the company of shielding profits in a "tax haven."

Guillemette said Uber's international operations, like that of many other technology companies, are based in the Netherlands.

"There is a fiscal pact between Canada and the Netherlands and we respect this fiscal pact, and we pay all the taxes that are needed to be paid in Canada," he said.

Guillemette said other jurisdictions in Canada have regulated Uber in a way that works and he wants Quebec to follow their lead, rather than that of Calgary.

In February, Uber ceased operations in Calgary after the city passed a bylaw requiring an annual $220 driver licensing fee, along with stricter requirements for background checks and vehicle inspections.

"Edmonton, Ottawa and Toronto have regulated us in a way we can operate," he said.

"Calgary decided to regulate us in a way we can't. And they were aware of it."

The company is holding a "save Uber in Quebec" rally at noon today, while a taxi drivers are taking part in a rival anti-austerity protest.