Uber has revised its driver contracts outside London to mitigate the impact of the UK's new "taxi tax," a VAT measure expected to generate 700 million annually. Under the new terms, Uber will act as an agent, allowing drivers to contract directly with passengers. This change aims to prevent fare hikes for passengers and reduce Uber's VAT exposure, as VAT will now apply primarily to Uber's commission rather than the full fare, potentially impacting government tax revenue.