Ride-hailing service Uber B.V. has promised to pay its overdue tax arrears in Vietnam within this week, but stressed that it would continue to file formal complaints against the tax collection and even take the matter to court if necessary.
The promise was made in a letter Uber sent to the tax department of Ho Chi Minh City on Wednesday, the taxman confirmed to Tuoi Tre (Youth) newspaper the same day.
In the letter, Uber pledged to arrange its budget for the payment of VND66.68 billion (US$2.95 million) in back taxes to be made within this week.
“It is still not clear whether Uber B.V. will pay the amount in full or in part,” a tax official said.
“On our part, we underline that our collection of Uber’s tax arrears is in accordance with current regulations.”
Last week, the southern city’s taxman gave Uber an ultimatum to pay the amount within ten days after the company had failed to comply with earlier requests.
The Netherlands-based Uber B.V., which oversees the ride-hailing app’s operations in Vietnam, was first required to pay the sum in September after the municipal taxman completed an inspection of the company’s operations in the southern hub.
However, Uber completely ignored the request and refused to pay any part of the back taxes.
The firm later filed a petition against the tax claim to Vietnam’s Ministry of Finance, reasoning it had fulfilled its tax duties in the Netherlands in accordance with a treaty against double taxation signed between the European country and Vietnam.
The petition was dismissed, with the finance ministry asking the company to pay the full amount as demanded by the Ho Chi Minh City taxman.
In related news, the European court of justice (ECJ) on Wednesday ruled that Uber is a transport services company, requiring it to accept stricter regulation and licensing within the European Union (EU) as a taxi operator, The Guardian reported.
The decision in Luxembourg, after a challenge brought by taxi drivers in Barcelona, will apply across the whole of the EU, including the UK, and cannot be appealed against.
Uber had long denied that it was a transport company, arguing instead it was a computer services business with operations that should be subject to e-commerce governance.
This argument has baffled Vietnamese authorities as they struggle to seek the best way to administrate the company, while conventional taxi firms argue that Uber and similar services like Grab enjoy too lax regulation compared to a regular transport services company.