“The thing that whether the Tax Department will continue to implement the coercive enforcement measures to collect the rest of Uber’s unpaid taxes or not will depend on the court's final judgment," the Tax Department’s representative told local media VnExpress.
According to the Tax Department, before receiving the court’s temporary urgent decision, it has sent official letters requesting five commercial banks, namely Vietcombank, Eximbank, Sacombank, ACB and VietinBank to suspend Uber B.V.’s accounts in the above 10 days.
Accordingly, the fares paid to Uber via bank account would be sent to the Tax Department’s account instead of being transferred abroad to Uber B.V.
The duration of the coercion would have lasted for ten days from January 01 to January 10, 2018 so that the Tax Department can collect enough VND53 billion (US$2.3 million) in tax arrears. This is the rest of the VND66.68 billion (US$2.9 million) that Uber was forced to pay by the Tax Department as merely VND13.3 billion (US$594,000) has been submitted by Uber’s Vietnam-based office so far.
Previously, after inspecting Uber’s tax records since it started operations in Vietnam in 2014 to June 2017, the Tax Department requested Uber B.V. to pay the tax arrears.
Notably, Uber must pay VND10.5 billion ($461,589) in taxes withheld, as well as VND26.3 billion ($1.16 million) of VAT and more than VND14.6 billion ($641,841) of personal income tax.
Besides, the company was also requested to pay around VND10.3 billion (US$459,000) worth of fines for wrong tax declaration resulting in payable tax shortfall and VND4.9 billion (US$218,000) worth of late payment fee.
Uber B.V. filed its complaint to the General Department of Taxation and the Ministry of Finance (MoF) on the grounds that Uber had fulfilled its tax obligations under Double Taxation Avoidance Agreement signed between Vietnam and the Netherlands (the Agreement).
However, MoF confirmed that Uber B.V. was not entitled to tax exemption under the Agreement as it has generated income in Vietnam from its ride-hailing services on a network of local partner drivers.
On December 13, 2017, the HCMC Department of Taxation issued an official letter requesting Uber B.V. to pay the aforementioned amount in taxes within 10 days (not later than December 23, 2017). However, the company has just paid VND13.3 billion. The rest, Uber B.V. said it would continue to protest and litigate the matter if necessary.
