Latest news with #EdwardMiller
Scoop
02-07-2025
- Business
- Scoop
New Report: Uber Shifted Millions Offshore, Avoiding $56m In NZ Tax
A new report from the Centre for International Corporate Tax Accountability and Research (CICTAR), commissioned by Workers First Union, argues that multinational rideshare and delivery giant Uber appears to be shifting hundreds of millions in misclassified profits out of New Zealand, costing the country millions in tax revenue. Read the full report HERE: The report examines Uber's local and global business practices and approach to revenue and taxation, concluding that Uber's practice of misclassification extends beyond its exploitation of New Zealand employment law and exists as a foundational principle of the business. "In 2023, Uber's NZ subsidiaries paid just $1.2 million in tax while transferring some $200.2 million in 'intercompany service fees' offshore, likely to an intellectual property holding company in Delaware," said Edward Miller, CICTAR researcher. "Recording these profits in Aotearoa would have delivered another $56 million in tax revenue and helped to fund the roads, infrastructure and public services that companies like Uber depend on to operate." The report, titled "The Business of Misclassification', describes Uber's treatment of service fees - the fee drivers pay the company to use its platform - as its source of declared revenue rather than the fare paid by passengers. "Uber believes it is a technology company rather than a transport company, and that drivers are its consumers, who pay a service fee to use the platform and be connected with end-users, with whom they contract directly," said Mr Miller. "Not only does this misclassify the business transaction and the workforce, but it also has the effect of misclassifying firm revenue and taxable profit." "Shifting profits to a jurisdiction like Delaware could enable Uber to deploy the billions in tax assets it has accumulated through its rapid expansion, delivering extraordinary benefits to shareholders." In 2024, New Zealand's Court of Appeal confirmed the Employment Court's original ruling from 2022, which found that Uber had misclassified a group of Uber drivers as 'contractors', which denied them access to minimum wages, sick leave, the right to collectively bargain and other entitlements. This report argues that misclassification itself sits at the heart of the Uber model. "The 2023 financial statements for Uber's NZ subsidiaries state combined firm revenue of $365 million, but this presumes that Uber is a technology company that simply delivers services to drivers," said Mr Miller. "We estimate that the revenue generated by delivering transport services came to $867 million that year, which would have made it the 61st largest company in the country." "Taxing digital service providers is a huge challenge for regulators, but failure to do so will see a growing proportion of economic activity in New Zealand recorded as digital services provided by overseas companies." Dennis Maga, Workers First General Secretary, said the report's conclusions would be "shocking" to Uber union members and should motivate politicians to close loopholes in law that allowed predatory multinationals to take advantage of New Zealanders and the country's infrastructure. "The entire Uber model is built on deception," said Mr Maga. "I don't think anyone really believes that Uber is just a tech company that connects passengers and drivers through an app. It's a transport company that makes millions in profit and simply does not pay its fair share of tax." Mr Maga said Minister Brooke van Velden must stop "cosying up" to Uber and cease her push to enshrine Uber's "dodgy" business practices in law. "Instead of laying out the red carpet for Uber to write their own laws, the Minister should be protecting New Zealanders from exploitation and ensuring they contribute something back to our country, rather than just taking our money overseas," said Mr Maga. The Supreme Court of New Zealand will hear Uber's final appeal on the case of the four Uber drivers who were misclassified as contractors on Tuesday 8 and Wednesday 9 July. This follows rejected Uber appeals to the Employment Court and the Court of Appeal. "The world is watching," said Mr Maga. "Will we meet the challenge in front of us and ensure fairness in our tax system, or will we be another victim of a corporate steamroller that is crushing economic sovereignty around the world?"
Scoop
05-05-2025
- Business
- Scoop
Bupa Under Scrutiny For Tax Practices As Workers Face Cuts
A new report from E tū and international tax watchdog CICTAR has raised serious questions about whether aged care giant Bupa is shifting profits offshore to avoid paying its fair share of tax in Aotearoa. E tū is calling for urgent reform and transparency in aged residential care funding, following the revelations that Bupa – the country's second-largest provider – has paid just $12 million in income tax over the past decade, despite reporting nearly $300 million in profits. 'We spend billions of dollars each year on aged residential care, but there is very little transparency about whether that money supports decent jobs for workers, and decent care for residents, or simply subsidises corporate profits,' says Edward Miller, researcher with the Centre for International Corporate Tax Accountability and Research (CICTAR). 'Our research suggests that over the last decade, Bupa earned $3.3 billion in revenue and $293 million in profit, but only paid a total of $12 million in income tax – an effective tax rate of just four percent. 'In addition, a major intercompany loan appears to have reduced their taxable income by $150 million over the last decade. That could have cost Aotearoa up to $27 million in lost tax revenue over that period.' E tū National Secretary Rachel Mackintosh says the report reveals a disturbing pattern. 'At the same time as Bupa is sending tens of millions overseas in interest payments on questionable debts to other Bupa subsidiaries, they're pushing through dangerous new rosters that cut hours and destabilise care,' Rachel says. 'Care workers are rightly asking whether Bupa is putting tax planning ahead of providing safe, decent care for residents. In 2023, for instance, Bupa made $12 million in pre-tax profit but paid just $11,000 in corporate tax – that's about what a Level 4 care worker pays.' Rachel says while more funding is urgently needed for the sector, companies must also be held to account. 'We need increased investment in aged care, but with it must come transparency. New Zealanders deserve to know their taxes are going to support quality care, not just boost overseas profits. 'It's time to put the wellbeing of our elderly and those who care for them at the centre of this system.'
