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Uber beset by difficulties

Released at: 17:42, 03/10/2017

Uber beset by difficulties

Photo: Internet Archives

Company fined and ordered to pay tax arrears and has also lost its CEO recently.

by Quynh Nguyen

2017 has been something of a tumultuous year for Uber in Vietnam, with it having difficulties in operations and facing ongoing opposition from traditional taxi firms. It also recently lost its CEO.

In late September, the Ho Chi Minh City Department of Taxation issued a decision imposing fines and collecting taxes from Uber, totaling $3 million, after tax inspections were conducted on financials during its more than three years in Vietnam.

Uber was fined for false declarations that reduced its tax payable by nearly VND10.3 billion ($453,200), and was ordered to pay tax arrears of nearly VND51.48 billion ($2.265 million).

While Uber Vietnam has not made any official response to the tax department’s decision, information continues to appear on social networks indicating that the company will cease operations in Vietnam until it fulfills its tax obligations.

Meanwhile, Mr. Dang Viet Dung, CEO of Uber Vietnam for the last three years, has left the company, which may also impact on operations.

Recently, Mai Linh Mien Bac, a major taxi company in Vietnam owned by the Mai Linh Group, was reported to be preparing to launch motorbike transport services called M.Bike and M.Bike Premium, to compete with uberMoto and GrabBike.

Vinasun, the leading taxi company in Ho Chi Minh City in terms of market share, recently proposed a series of measures to make Uber and Grab comply with existing law and ensure fair competition.

According to Vinasun, Uber and Grab have used apps to connect drivers and customers without gaining permission from authorities. And while Vinasun must pay taxes and abide by 13 business conditions, Grab and Uber do not.

At a workshop entitled “Urban Traffic Regulation Policy in the Digital Era” held by the Vietnam Center for Economic and Policy Research on September 8 in Hanoi, economist Pham The Anh agreed that Uber and Grab are a test of the direction towards promoting science and technology in real life and in economic activities.

“Policy makers need to make assessments from a variety of perspectives, such as consumers, service providers, and taxi companies, to come up with appropriate policies,” he said.

Uber entered Vietnam in July 2014 and late last year Vietnam became the first country in Southeast Asia to launch cash payments, and since then a significant proportion of fares have been paid for by cash. uberMOTO was also launched earlier this year, providing motorbike taxis with lower fares.

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nahuybk

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Apparently, Uber is still the largest taxi company in the world