Despite not showing big profits yet, Uber is making moves to ensure that it pays next to nothing in taxes if and when it finally does become profitable. It was recently reported that Uber, in a presentation made to investors last fall, had assigned its IP to Bermuda. As a result, less than 2% of its total revenue would be subject to taxes by the Federal government.
“Artful Dodger”, Uber CEO Travis Kalanick
This is a story that was first covered earlier this week by Bloomberg reporter David Kocieniewski, who writes that a new breed of “sharing economy” companies like Uber will, as they eventually move towards profitability, transform huge chunks of the US economy, potentially putting billions of dollars in corporate tax revenue at risk.
In the original article, Kocieniewski writes:
For years, pharmaceutical and tech companies including Pfizer, Merck, Google, and Apple have slashed their U.S. federal tax bills by using offshore tax havens and shifting profits abroad. Airbnb and Uber are starting to extend this strategy across vast new fields: PricewaterhouseCoopers estimates that sharing-economy businesses generated $15 billion in revenue in 2014 and will take in $335 billion in 2025, growing largely at the expense of companies that pay billions in US taxes.
All of which should come as no surprise to people who’ve looked at Uber as a new technology that’s a bit too good to be true- even if you ignore the thousands of alleged sexual assault complaints against Uber drivers and the company’s somewhat difficult-to-understand insurance coverage policies. But that’s just my take, and I’m usually pretty negative, anyway.
What do you guys think? Is Uber making moves that are technically within the letter of the law to avoid paying taxes something that most people will ignore, or is it just one more reason to question the ethics of the company’s management? Let us know in the comments.