Philadelphia is suing Uber over allegation of unpaid taxes
Uber has ignored repeated requests from the city to comply with an audit, the lawsuit claims.
Philadelphia is suing Uber to get the company to open its books in a bid to recoup two years of taxes it alleges that the tech giant owes.
The suit, filed Tuesday in Common Pleas Court, seeks to audit Uber Technologies Inc. to determine whether the San Francisco-based company owes the city business income, receipts, and wage taxes from 2015 to 2017. The City Charter authorizes the Department of Revenue to conduct audits of any business operating in the city, the suit states.
Uber operated in Philadelphia without authorization during some of that time. Ride sharing wasn’t legalized in the city until November 2016.
The suit comes after Uber ignored multiple requests for financial data from the Department of Revenue, the suit states. The city’s efforts to get audit information from Uber date to August 2018, when it sent a questionnaire on tax years 2015 to 2017, the suit states. The city sought to obtain Uber’s federal, state, and local tax returns, employee income tax forms, and personal information on anyone who received non-employee compensation. Uber never responded, and the company ignored two more requests for the information sent in September and October, according to the suit.
Uber didn’t respond to the requests for information for an audit, company spokesperson Harry Hartfield said Tuesday, because it never received them. The requests were sent to its San Francisco address and were lost in the mailroom, he said. After learning of the suit Tuesday, the company contacted the Revenue Department to comply with the requests. The company anticipated that the suit would be withdrawn as soon as it provided the documents.
“We are pleased to hear that Uber will comply with the audit request,” said Mike Dunn, a spokesperson for the city.
The suit included copies of the three letters requesting information for an audit sent to Uber’s San Francisco address and copies of slips confirming Uber’s receipt of the letters.
Uber did not comment on the city’s allegation that it may owe taxes.
In 2017, Uber made more than $320 million in Philadelphia, according to Parking Authority records.
The company is famously protective of information that could provide insight into its operations, but some of that secrecy has dissipated as the company prepares to become publicly traded. Ride-sharing companies have to pay a per-ride fee to the PPA, but even that agency has poor access to information about the industry, including the exact number of drivers operating in the city. Its estimate is 25,000.
The lawsuit asks a judge to order Uber to provide the financial data within 30 days and fine the company $900 for failing to comply with the city’s requests for information.