GST now applies to Uber trips

THE cost of using the UberX ride-sharing service will increase 10 per cent following a tax office ruling that GST should be applied on trips.

Uber is challenging the Australian Taxation Office's ruling in court, but in the meantime told customers that prices would increase from Friday.

"Uber believes that all of its driver partners should pay their appropriate share of tax," the company said in a statement.

"However, we believe driver partners and riders are being unfairly singled out, and so Uber is challenging the ATO's position in the Federal Court of Australia."

The fight with the ATO is just one front on which Uber is challenging authorities. The Queensland government fined more than 500 UberX drivers more a combined total of more than $1.7 million in the 12 months to June.