The Court of Appeal has overturned previous tribunal decisions and ruled that Bolt Services UK Ltd’s on-demand mini-cab services do not qualify for a special VAT concession designed for travel agents and tour operators. The judgment, delivered on July 23, 2026, clarifies the application of the EU VAT Directive and domestic UK law concerning the eligibility criteria for this scheme.
Bolt had sought to benefit from a VAT arrangement under which suppliers charge tax only on their margin rather than the full fare. This scheme, outlined in the VAT Directive 2006/112/EC and incorporated into UK law through the Value Added Tax Act 1994 and subsequent regulations, typically applies to travel agents and tour operators who bundle multiple travel services, often across borders. Bolt contended that its platform, which allows customers to request private hire vehicles via a smartphone app 24/7, was sufficiently similar to the services of traditional travel intermediaries to merit inclusion.
The service provides users with the option to choose vehicle types—standard, luxury, or larger capacity—and matches ride requests to drivers based largely on proximity. While both the first-tier tribunal and the upper tribunal initially sided with Bolt, accepting a “high-level” approach that classified its services as broadly analogous to those of travel agents and tour operators, the Court of Appeal took a different view.
Lady Justice Falk, delivering the court’s unanimous ruling, emphasized that the scheme’s application must be limited to transactions that are “identical or at least comparable” to those carried out by travel agents and tour operators. This standard aims to prevent distortion of competition and ensure uniform VAT treatment. The court stated that Bolt’s on-demand mini-cab rides bear neither an identical nor sufficiently comparable relationship to the multi-element travel services traditionally offered by tour operators or travel agents.
The court acknowledged that while the VAT scheme is not strictly confined to conventional travel agents and tour operators, it was originally designed to address the complexities associated with cross-border travel packages. Applying the scheme to Bolt’s services, primarily domestic and focused on single-journey transportation, was neither necessary to achieve the scheme’s objectives nor consistent with existing European case law.
The Court of Appeal criticized the lower tribunals’ reliance on a broad categorization of services, noting that an overly generalized “high-level” approach failed to properly address the need for comparability. It dismissed concerns raised by the upper tribunal that a detailed comparison would be difficult and resource-intensive, asserting that practical challenges do not justify expanding the scheme’s scope beyond its intended limits.
Bolt’s representation argued that their services shared key characteristics with travel operators, but the court found no serious basis to equate on-demand app-based mini-cab services with traditional travel agent or tour operator offerings, which do not typically include such rides.
As a result, the appeal lodged by Her Majesty’s Revenue and Customs (HMRC) has been allowed, reaffirming that the VAT concession cannot be applied to Bolt’s mini-cab platform. This ruling reinforces the narrow scope of the VAT scheme and clarifies its application amid evolving digital transport services.