Uber has shifted responsibility for VAT payments to its 40,000 drivers, allowing the company to dodge payments of £40 million a year in the UK

Uber is avoiding about £40 million tax a year by exploiting a loophole in VAT rules, it emerged yesterday.

The loophole allows Uber to shift responsibility for VAT payments to its 40,000 drivers, allowing the company to keep its full share of the estimated £200 million fees it generates annually from charging them to use its taxi-hailing app.

The revelation is further evidence that global technology companies are treating national tax rules with impunity. It also makes a mockery of government pledges to stop internet companies avoiding tax.

Margaret Hodge, the former chairwoman of the Public Accounts Committee, said it was “yet another example of how large companies find loopholes and use the law for a purpose for which it was never intended”.

“There is