Uber admits its drivers in Malaysia could face taxation
KUALA LUMPUR: Uber has admitted that its drivers in Malaysia could face taxation on the revenue generated from its ride-sharing services.
Uber Malaysia Sdn Bhd general manager Leon Foong said the drivers are responsible for their own tax affairs.
"The taxation differs from driver to driver. Only they know their income from driving and other sources and what is taxable," said Leon in an email interview with theSun.
He said the company does not generate income on the basis of fares.
"Uber Malaysia is paid for providing marketing and support services to the Malaysian rider and driver community," he pointed out.
Leon also confirmed that the fares paid via credit or debit card are wired to Uber subsidiary in Netherlands.
"Uber in Malaysia does not collect fares from the Malaysian driver community," he said, adding that drivers have no ability to process credit card transactions on their own and the lion's share of the revenue generated by the transaction goes to drivers and stays in the local economy.
He also said between 70% to 80% of the fare collected from a passenger is channelled to the driver on weekly basis.
Asked if the company will be ready to comply with the possible scenario of Inland Revenue Board (LHDN) to tax the income generated from the fares collected when 'e-hailing' takes off, Leon replied: "As a company registered in Malaysia, we comply with all relevant local tax obligations."
However, Uber Malaysia declined to disclose details on the amount of tax paid to the government since 2010.
On May 16, theSun reported that Uber drivers may be subjected to taxation by the government in view of Uber's shrewd tax strategies globally.
It was reported in many countries, Uber allegedly took advantage of the loopholes in tax regulations by legally transferring its ride-sharing income to its sister company in Netherlands.
Last June, Land Public Transport Commission chairman Tan Sri Syed Hamid Albar said Uber's cashless payment did not benefit the country.
"The money (fare paid) goes out of the country and our ringgit does not circulate locally," he had said.