"These numbers suggest that approximately 74 percent of driver profit is untaxed", the study, by Stephen M. Zoepf, Stella Chen, Paa Adu and Gonzalo Pozo, said.
The study relied on self-reported data on revenue, mileage and vehicle choices from more than 1,100 Uber and Lyft drivers and cross-referenced it with maintenance, repairs, fuel and depreciation, using data from the EPA, Edmunds and Kelly Blue Book.
MIT authors also calculated that it's possible for billions of dollars in driver profits to be untaxed because "nearly half of drivers can declare a loss on their taxes".
"This business model is not now sustainable", Stephen Zoepf, executive director of the Center for Automotive Research at Stanford University and co-author of the paper, told The Guardian.
For the third phase of the initiative, Uber is focusing on driver flexibility.
24 killed in Azerbaijan drug rehab centre fire
Ten squads of firefighters and rescuers from the emergencies ministry struggled to extinguish flames that engulfed the clinic. A defect in the power grid of the building containing the center is said to be the cause of the fire.
In April of past year, The Information reported Uber was only retaining about 4% of drivers annually.
Drivers can set up to six destinations per day, meaning Uber will only offer rides along that route.
Uber also enacted new waiting time charges that will be applied to users who keep drivers waiting at the start of a journey. "Ride-hailing operators know what they pay each driver but do not know whether drivers earn additional wages from a competitor nor what drivers actually spend to operate their vehicles".
Uber dispelled numerous of the study's conclusions.
While Lyft is yet to acknowledge the study, an Uber spokesperson released a statement this claiming "its methodology and findings are deeply flawed".
'We have not reviewed this study in detail, but an initial review shows some questionable assumptions, ' a spokesperson for the firm told the Guardian.
As of 2017, both Uber and Lyft allow (but do not require) customers to tip their drivers through their respective mobile apps.
In June, Uber added a tipping feature for drivers in the U.S. Since then, it introduced an initiative called "180 days of change" to focus on increasing drivers' earnings.