- HMRC has won a £190m tax dispute against Bolt.
- Court rejects Bolt's attempt to apply a travel industry VAT scheme.
- The ruling could influence Uber's separate £1.4bn tax case.
Britain's tax authority has secured a significant victory in a long-running VAT dispute with ride-hailing company Bolt, a ruling that could have far-reaching consequences for Uber and other app-based transport operators.
The Court of Appeal sided with HM Revenue and Customs (HMRC) in a case worth around £190 million, overturning two earlier tribunal decisions that had favoured Bolt. The dispute centred on how VAT should be applied to fares booked through ride-hailing platforms, an issue that has become increasingly important as companies such as Bolt and Uber expand their presence in the UK market.
The decision could prove particularly significant for Uber, which is waiting for a ruling in a separate but closely watched VAT case worth more than £1.4 billion.
A fight over how fares are taxed
Bolt had argued that VAT should be charged only on the company's margin rather than on the full fare paid by passengers.
The company sought to use the Tour Operators Margin Scheme (TOMS), a tax arrangement originally designed for travel agents and tour operators. Under that system, VAT is generally applied to the profit margin rather than the entire transaction value.
However, the Court of Appeal rejected that argument and ruled that Bolt should not be allowed to rely on the scheme.
The judgment represents a major win for HMRC, which has consistently argued that ride-hailing operators should account for VAT on the full amount charged to customers.
For consumers, the legal arguments may seem technical. But for companies operating large transport platforms, the outcome can have a substantial impact on tax bills, operating costs and profitability.
Why Uber is watching closely
The ruling is likely to be studied carefully across the ride-hailing sector because Uber is facing a similar challenge.
Uber's case has been paused while the courts considered the Bolt dispute. According to a tribunal ruling published last year, Uber had already deposited disputed tax amounts totalling £1.446 billion while the matter remains unresolved.
Although the Bolt judgment does not automatically determine Uber's case, it may provide a strong indication of how courts view the issue of VAT treatment for ride-hailing businesses.
The latest decision also highlights the growing scrutiny facing digital platforms as tax authorities seek to clarify how existing rules should apply to newer business models.
A spokesperson for Bolt reportedly said the company was disappointed by the ruling and is considering its next steps.
The case is expected to remain closely watched by investors, tax specialists and the wider transport industry, particularly as courts continue to examine how traditional tax frameworks apply to rapidly evolving platform-based businesses.
