As the issue between the Land Transportation Franchising and Regulatory Board (LTFRB) and Transportation Network Companies (TNCs) begin to move forward, the government agency reiterated that both Grab and Uber are not exempted in remitting taxes to the government.
The issue arose from the fact that there were several 'colorum' Grab and Uber operators/drivers that continued to pick up passengers without the necessary accreditation. According to the two ride-hailing companies, there are about 56,000 Transport Network Vehicle Services (TNVS) plying the streets, including the 3,000 which have approved franchises from Grab and Uber.
This meant that around 40,000 of the 56,000 activated Transport Network Vehicle Services (TNVS) drivers are operating without being required to file tax returns to the Bureau of Internal Revenue (BIR).
“Like any business, TNCs and their partners are covered by laws of taxation and they must give what’s due to the government,” said LTFRB Chairman Martin B. Delgra III.
In a press conference held last Tuesday, Department of Transportation (DOTr) Secretary Arthur Tugade commented that anyone who wants to be in the TNC business must have the proper regulations. He added that not only will it make such public transportation services accountable, but will also allow the government to collect the correct taxes from TNCs.
“The problem is how can the government be assured that it is getting its fair share from these TNCs when majority of their drivers do not have franchises? Under existing laws, the TNCs, owner of vehicles, and drivers who are earning from this business all have tax accountability,” added Delgra.
As a reminder, the BIR issued the Revenue Memorandum Circular No. 70-2015 or the guidelines for the taxability of TNCs and their partners last October 29, 2015.