The General Department of Taxation asks Grab to “be careful when speaking” | Finance – Business

12/12/2020 Business, Vietnam



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The General Tax Department, the Ministry of Finance, has just sent a document to Grab Co., Ltd. regarding the statements of this business to the press. After the entry into force of Decree 126/2020 / ND-CP, the opinion of Grab Co., Ltd. about this company appeared in the media, increasing freight rates and increasing tax deductions for drivers of activities operational. business due to the impact of Decree 126.

To clarify this issue, on February 9, the General Tax Directorate held a meeting with representatives of the Grab on the content of Decree 126 with the participation of the Transport Directorate of the Ministry of Transport. At the meeting, the General Directorate of Taxation said it had listened to Grab’s comments and explanations about the price increase and discount rates with customers. However, Grab has not provided enough information on the price increase and tax deductions for drivers due to the impact of Decree 126.

At the meeting, the General Tax Directorate affirmed that the Government’s point of view when promulgating Decree 126 aims to enhance the responsibility of the organization in the business cooperation model with people. Specifically, in Point c, Clause 5, Article 7 of Decree 126 stipulates: “If organizations do business with individuals, they do not declare taxes directly. Organizations are responsible for declaring value added tax (VAT) on all income from business cooperation activities … regardless of the form of distribution of the results of business cooperation ”.

“Thus, Decree 126 specifies the responsibility of the organization to declare taxes in the model of business cooperation with people, not new regulations on VAT policy – this policy is applicable to transport activities. change: 10% VAT rate still applies as before. The new regulations of Decree 126 do not increase the tax liability of the individual driver (the driver is only subject to the 1.5% personal income tax if he has a turnover greater than 100 million VND), does not increase the freight (due to that the 10% VAT policy for transport remains unchanged) ”, stated the General Directorate of Taxation.

The representative of the Ministry of Transport also stated that Grab’s business is transportation. Grab Co., Ltd. should have the primary responsibility for the transportation operation because the company decides the freight rates, customer selection and driver selection.

It should be noted that the General Directorate of Taxation requires that Grab be cautious when speaking when explaining to the public and the driver about the increase in the price structure due to the impact of Decree 126, so as not to generate misunderstandings. correct fiscal policy of the State. Grab must also respect the social responsibility of employees and drivers in Vietnam.

Earlier, just after the meeting, on the evening of February 9, Grab Vietnam issued a statement saying “extremely disappointed that the work results have not achieved any positive results,” and that the General Tax Department did not There is consistency in determining who is subject to value added tax (VAT).

“We are very upset by the request of the General Department of Taxation to increase the tax revenue on the income of the driving partner from 3% to 10%, although we know that these driving partners are not able to deduct VAT.” entry, but the General Department of Taxation does not have a clear explanation based on very inconsistent points, “said Grab’s statement.




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