Rejecting Uber’s complaint about decision on Tax arrears of VND 66 billion

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The Ministry of Finance quoted provisions in the Vietnam’s Tax Law and the Double Taxation Agreements and prevention of tax fraud between the Vietnamese Government and the Netherlands to verify the permanent establishment and Tax obligation of the contractor, Uber B.V Netherlands Co., Ltd., in Vietnam.

According to information from the Ministry of Finance, the official letter 10448/BKHDT-PTDN from the Ministry of Planning and Investment, sent to Uber Vietnam Co., Ltd., stated that “Uber .V is established under the Law of Netherlands and its commercial representative in Vietnam is Uber Vietnam Co. Ltd.,”. In fact, Uber Vietnam Co. Ltd., is on behalf of Uber B.V Netherlands Co. Ltd., and the latter is responsible for tax declarations and payment of Contractor Tax.

In the process of the tax audit for Uber Vietnam Co. Ltd., Ho Chi Minh City verified that this company has income arising in Vietnam from providing customer transport services through drivers.

Specifically, customers directly using the service by hiring a car via the Uber application, Uber B.V Netherlands Co. Ltd., will provide a driver, charge and directly receive the payment, and decide promotions and discount policies for customers.

Therefore, the income of Uber B.V arises in Vietnam through driver partners providing a service of more than 6 months within 12 consecutive months.

“Pursuant to the above regulations and the result of Tax audit in Uber Vietnam Co. Ltd., Uber B.V Netherlands Co. Ltd., has income arising in Vietnam through permanent establishments in Vietnam. Hence, the Company has the obligation to pay contractor tax as per regulations”, the official letter of the Ministry of Finance stated.

Uber Netherlands finalizes documents to declare and pay taxes to the State budget

Regarding the tax arrears arising before the Ministry of Finance issuing the guidance document. The Ministry said that Uber B.V Netherlands signed contracts with drivers in Vietnam and agrees to share business profits on the basis of turnover. Thereby, Uber Vietnam, or the organization authorized by Uber B.V Netherlands, shall be on the behalf of Uber B.V Netherlands Co. Ltd., to declare and pay Contractor Tax and transport operators, and to provide information to the Tax authority.

If incomes before the Ministry of Finance’s guiding document have not yet been declared or have paid taxes differently to the guidelines in the official letter, they must be declared, amended and supplemented, and paid to the State budget in accordance with the provisions.

The Ministry of Finance said that if Uber B.V disagrees with the decision on the sanction for tax administrative violation issued by Ho Chi Minh City Customs Department, it will implement it under the provisions of the Law on Complaints.

It is acknowledged that Ho Chi Minh City Customs issued the decision on sanction for tax administrative violation and collected a tax arrear of over VND 66.68 billion from Uber B.V Netherlands. Of which, the fine for the wrong declaration was nearly VND 10.3 billion and tax arrear was VND 51.48 billion, and the late payment was more than VND 4.9 billion.

According to a proposal by the US - ASEAN Business Council on 18 th October, the Ministry of Finance held a working session with a representative of the Council and a representative of Uber B.V Netherlands, related to the decision on collecting tax arrears and application of the Double Taxation Agreements signed by Vietnam and Netherlands.