If I understand this properly, it is a gratuity. The way I understand it, the taxi is still a normal taxi in operation but essentially has hooked into Uber to give it a new way to find fares and to have people pay. If this is the case, then the rate is the same with or without Uber and you still need to pay the gratuity and Uber just automatically selects that gratuity to be 20%. It's actually appreciably different from Uber choosing a rate and then adding a 20% automatic gratuity on top of it.
They make you rate them, so you have to do that interaction anyways. Not really much more inconvenience if there was a slider or buttons there for tip %.
With Uber, you pay for a higher-quality of service. The ratings and screening should give you better drivers and maybe even better maintained cars and shorter wait time.
None of those benefits are guaranteed, obviously, but it's easy to imagine it working after having used Uber Black for so long and constantly being impressed by the professionalism of their drivers and quality of the experience.
I feel like this is what the rating system helps deal with. You should be finding yourself with drastically more taxi experiences where 20% is a reasonable tip.
If it is in fact what you'd normally tip, why would you let this prevent you from using the service? Unless you have an extremely bad experience (which I'm pretty sure you can report) - why let it be the one thing to stop you?
This is probably the fee they charge the taxi owners. This way, the added cost of their service is covered by the customers rather than the taxi owners.
