4 ms·

I never said (or meant only) "tax loopholes", Uber may even end up paying more tax than taxi companies. But taxi companies have a far, far higher bar in the eye

I never said (or meant only) "tax loopholes", Uber may even end up paying more tax than taxi companies. But taxi companies have a far, far higher bar in the eyes of the law. In most countries you can't just decide to climb in your private car and provide commercial transportation service. You have to spend a lot of time and money to get there, authorizations, commercial insurance, driver certifications, etc. Uber bypassed it by saying "we're a tech company" and left it to the drivers, making the enforcement of the law a lot harder. Hotels also have higher requirements than an AirBnB host but the company says "we're just the tech platform". Just look at conflict resolution and what kind of leverage and protections a client has when dealing with a hotel vs. dealing with a private renter to see the massive gap that comes attached to that "disruption". Because that's the thing, you could have short-term renting in the past but that wasn't an alternative to hotels. AirBnB made it a hotel alternative so that's the benchmark. Same with Uber, you could (legally) hitchhike in the past but Uber made the service a taxi alternative. Imagine Google "disrupting" the state/national/federal identity registry, as in become the equivalent of the passport or identity card issuer while offering Google-style support and SLAs. Some services are important enough to be regulated, this is what today's disruptors are bypassing. The solution to an industry being crap isn't to allow someone to bypass existing regulation, it's to create a set of effective regulations that can be applied equally to everyone.

kd5bjo 6y ago
> Uber bypassed it by saying "we're a tech company" and left it to the drivers, making the enforcement of the law a lot harder. The original loophole that Uber used was San Francisco’s different regulations between taxis and limo companies: The latter are less regulated but are allowed to accept prebooking, and not street hails. Uber realized that ordering a ride via a phone app is more convenient than trying to hail a passing taxi in many cases and can be served by a limo company instead.
- emteycz 6y ago
  What's the difference from calling by phone, also served by many limo companies?
- buran77 6y ago
  Not very familiar with the situation across the pond but in much of Europe the expectation from companies providing commercial transportation services are far higher than just booking method: - Drivers need a different, more expensive license or attestation that needs to be renewed periodically; - Car needs a more expensive commercial insurance that covers all passengers and cargo, to a much higher payout, not just the driver like most Uber drivers have; - Car needs to be inspected far more often to ensure it's roadworthy and can stand that driving regime for the future; - Prices are regulated because the taxi service is seen as closer to public transport than to personal one. So you don't see price fluctuations more than you'd see for the bus; - They need an authorization to serve an area (meaning they were checked according to local regulation); - The company is responsible for its employees in many ways; - And more. A restaurant's kitchen has higher requirements than your private one which makes owning and operating a commercial kitchen far more resource intensive than a private one. There's no "kitchen sharing" where you can sell food straight from your private kitchen, "infirmary sharing" where you can pretend you're a doctor or a hospital room, or "legal office sharing" where you can pretend to be a lawyer without meeting all the requirements imposed on those sectors. This is the loophole Uber exploited. Replace "car" with "house/room" and you get AirBnB. When they had enough of a head start they started complying with some regulation, while still acting like they're a different kind of service for what other regulation is concerned. They want to live on the border and pick and choose what applies to them, something no other commercial service is allowed to do. Except all the other disruptors who raise enough money to afford some fines while they still operate in a grey area. Cost of doing business.
  - kd5bjo 6y ago
    These are per-city rules in much of the US, but the limo companies that Uber was originally subcontracting to had to meet similar requirements in San Francisco as what tou describe. Booking is just the test that was used to determine which set of regulations apply to any given compan. For example, taxi supply was artifically constrained by a medallion system, but there was no such limit on the number of limos allowed to operate. (Past tense b/c I don’t live there anymore and am not up-to-date with current developments) They certainly have used the loophole you describe extensively, but that started later, once they were sure there were no repurcussions for the limo dodge.
syshum 6y ago
The problem here is you failed to identify the regulations as the problem in the first place, especially with Taxi's and Uber The regulations created an artificial scarcity for transportation that increased prices, and lowered quality of service to the point where people were BEGGING for a service like Uber to come along The solution to this problem is not "make Uber follow the tax regulations" which seems to be what you are suggesting
- jahaja 6y ago
  > The regulations created an artificial scarcity Is the classification as an employee, with attached benefits, artificial scarcity in a negative sense? If so, we got quite a few industries that would also love to remove this "artificial scarcity" and allow the use of day labourers.
  - syshum 6y ago
    Many taxi drivers, like uber drivers, are also classified as Independent contractors Employment classification was not what I was referring to, I am talking about the endless regulations around taxi medallion system that puts a government regulated cap on the number of taxi's
    - jahaja 6y ago
      Alright, but that's not the case in the majority of the places where Uber have, and have tried to, introduce day labourers.
      - syshum 6y ago
        >>Alright, but that's not the case in the majority of the places where Uber have I would love to see your source on that, most cities with any kind of taxi system have some permitting or medallion system that limits the number of taxis >>and have tried to, introduce day labourers. Do you view this as a negative? because I do not
908B64B197 6y ago
> But taxi companies have a far, far higher bar in the eyes of the law. In most countries you can't just decide to climb in your private car and provide commercial transportation service. You have to spend a lot of time and money to get there, authorizations, commercial insurance, driver certifications, etc. Uber bypassed it by saying "we're a tech company" and left it to the drivers, making the enforcement of the law a lot harder. Let's be real, most of it is getting a taxi medallion (sure you need a different driving license but any 18 years old can get it). Posted it in an other thread [0] but do we really want to go back to the medallion system? Pre-Uber, either the driver rented the car to a middleman who rented the medallion from a rich owner, or said owner was selling and financing (most banks won't touch these medallions!) a medallion at a ridiculous interest rate to a driver that planned to use it as his retirement savings (an extremely volatile asset and not very liquid). The more I spoke to cab drivers the more it seemed their industry was a pyramid scheme aimed at helping established rent-seeker take advantage of often poor new immigrants. Uber brought a breeze of fresh air: Someone could simply buy a car, calculate the depreciation and it's value on the market (since unlike medallions cars are relatively liquid assets!) do rideshare and calculate their profits or loss. They can get out of the game at anytime, and they know exactly how much they are going to get for the car they have should they sell it. Also, the argument on Uber/Lyft drivers not being contractors since they can't set their own rates and decide which ride they take strikes me as weird since medallion drivers were contractors, had to charge the price set by the city and could only pick-up customers in the (arbitrary) zones covered by their medallions. And I'm not even touching the usual pain points and often discriminatory practices of medallion drivers (refusing card payments, refusing rides to non-white passengers and to non-white neighborhoods...). [0] https://news.ycombinator.com/item?id=24225648 https://news.ycombinator.com/item?id=24225648

kd5bjo 6y ago

> Uber bypassed it by saying "we're a tech company" and left it to the drivers, making the enforcement of the law a lot harder. The original loophole that Uber used was San Francisco’s different regulations between taxis and limo companies: The latter are less regulated but are allowed to accept prebooking, and not street hails. Uber realized that ordering a ride via a phone app is more convenient than trying to hail a passing taxi in many cases and can be served by a limo company instead.

emteycz 6y ago
What's the difference from calling by phone, also served by many limo companies?
buran77 6y ago
Not very familiar with the situation across the pond but in much of Europe the expectation from companies providing commercial transportation services are far higher than just booking method: - Drivers need a different, more expensive license or attestation that needs to be renewed periodically; - Car needs a more expensive commercial insurance that covers all passengers and cargo, to a much higher payout, not just the driver like most Uber drivers have; - Car needs to be inspected far more often to ensure it's roadworthy and can stand that driving regime for the future; - Prices are regulated because the taxi service is seen as closer to public transport than to personal one. So you don't see price fluctuations more than you'd see for the bus; - They need an authorization to serve an area (meaning they were checked according to local regulation); - The company is responsible for its employees in many ways; - And more. A restaurant's kitchen has higher requirements than your private one which makes owning and operating a commercial kitchen far more resource intensive than a private one. There's no "kitchen sharing" where you can sell food straight from your private kitchen, "infirmary sharing" where you can pretend you're a doctor or a hospital room, or "legal office sharing" where you can pretend to be a lawyer without meeting all the requirements imposed on those sectors. This is the loophole Uber exploited. Replace "car" with "house/room" and you get AirBnB. When they had enough of a head start they started complying with some regulation, while still acting like they're a different kind of service for what other regulation is concerned. They want to live on the border and pick and choose what applies to them, something no other commercial service is allowed to do. Except all the other disruptors who raise enough money to afford some fines while they still operate in a grey area. Cost of doing business.
- kd5bjo 6y ago
  These are per-city rules in much of the US, but the limo companies that Uber was originally subcontracting to had to meet similar requirements in San Francisco as what tou describe. Booking is just the test that was used to determine which set of regulations apply to any given compan. For example, taxi supply was artifically constrained by a medallion system, but there was no such limit on the number of limos allowed to operate. (Past tense b/c I don’t live there anymore and am not up-to-date with current developments) They certainly have used the loophole you describe extensively, but that started later, once they were sure there were no repurcussions for the limo dodge.

syshum 6y ago

The problem here is you failed to identify the regulations as the problem in the first place, especially with Taxi's and Uber The regulations created an artificial scarcity for transportation that increased prices, and lowered quality of service to the point where people were BEGGING for a service like Uber to come along The solution to this problem is not "make Uber follow the tax regulations" which seems to be what you are suggesting

jahaja 6y ago
> The regulations created an artificial scarcity Is the classification as an employee, with attached benefits, artificial scarcity in a negative sense? If so, we got quite a few industries that would also love to remove this "artificial scarcity" and allow the use of day labourers.
- syshum 6y ago
  Many taxi drivers, like uber drivers, are also classified as Independent contractors Employment classification was not what I was referring to, I am talking about the endless regulations around taxi medallion system that puts a government regulated cap on the number of taxi's
  - jahaja 6y ago
    Alright, but that's not the case in the majority of the places where Uber have, and have tried to, introduce day labourers.
    - syshum 6y ago
      >>Alright, but that's not the case in the majority of the places where Uber have I would love to see your source on that, most cities with any kind of taxi system have some permitting or medallion system that limits the number of taxis >>and have tried to, introduce day labourers. Do you view this as a negative? because I do not

908B64B197 6y ago

> But taxi companies have a far, far higher bar in the eyes of the law. In most countries you can't just decide to climb in your private car and provide commercial transportation service. You have to spend a lot of time and money to get there, authorizations, commercial insurance, driver certifications, etc. Uber bypassed it by saying "we're a tech company" and left it to the drivers, making the enforcement of the law a lot harder. Let's be real, most of it is getting a taxi medallion (sure you need a different driving license but any 18 years old can get it). Posted it in an other thread [0] but do we really want to go back to the medallion system? Pre-Uber, either the driver rented the car to a middleman who rented the medallion from a rich owner, or said owner was selling and financing (most banks won't touch these medallions!) a medallion at a ridiculous interest rate to a driver that planned to use it as his retirement savings (an extremely volatile asset and not very liquid). The more I spoke to cab drivers the more it seemed their industry was a pyramid scheme aimed at helping established rent-seeker take advantage of often poor new immigrants. Uber brought a breeze of fresh air: Someone could simply buy a car, calculate the depreciation and it's value on the market (since unlike medallions cars are relatively liquid assets!) do rideshare and calculate their profits or loss. They can get out of the game at anytime, and they know exactly how much they are going to get for the car they have should they sell it. Also, the argument on Uber/Lyft drivers not being contractors since they can't set their own rates and decide which ride they take strikes me as weird since medallion drivers were contractors, had to charge the price set by the city and could only pick-up customers in the (arbitrary) zones covered by their medallions. And I'm not even touching the usual pain points and often discriminatory practices of medallion drivers (refusing card payments, refusing rides to non-white passengers and to non-white neighborhoods...). [0] https://news.ycombinator.com/item?id=24225648 https://news.ycombinator.com/item?id=24225648