Uber and Grab motorbike drivers on a steet. The HCM City Tax Department has decided to collect nearly VND67 billion of tax arrears from Uber. — Photo zing.vn

Uber Việt Nam CEO, Dang Viet Dung, on Saturday denied rumours that Uber would temporarily halt operations in Viet Nam until its tax dues were paid.

“The rumour is not true,” Dung said, adding that the company was operating normally in Viet Nam and even had further development plans.

The rumour began spreading on social networking sites on Saturday after a decision by the HCM City tax authority stated that Uber must pay some VND67 billion (US$2.9 million) in tax arrears. The rumour further said that Uber will halt operations in Việt Nam because the tax amount due was too large for the company to afford.

Dung said that Uber Viet Nam, and its mother company, Netherlands-based Uber B.V., would continue working with the tax authorities to figure out the most appropriate solution.

On Saturday, HCM City Tax Department said that it issued a decision to collect tax dues worth VND66.7 billion from Uber Việt Nam, after an inspection of the operations of the app, from its penetration into the Việt Nam market, until June 2017.

Nguyen Nam Binh, Deputy Director of the HCM City Tax Department, was quoted by Vnexpress online newspaper, saying that Uber B.V. did not completely agree with the decision.

Under the Ministry of Finance’s tax payment rules for Uber B.V. issued in September 2016, taxes will be imposed on the company following a direct method, according to which the payable amount is based on the revenue, multiplied by the taxation rate.

For Uber, the rates are 3 per cent for value added tax and 2 per cent for corporate income tax.

Individuals who have signed contracts with Uber to provide the taxi service should pay tax on their earned income. The rates for individual drivers are 3 per cent for VAT and 1.5 per cent for individual income tax. — VNS