Cairo – Mubasher: The Egyptian Tax Authority (ETA) forecasts to collect nearly EGP 6 billion in tax revenues by subjecting ride-sharing apps Uber and Careem to the value-added tax (VAT) for the past two years.
The state-run body has called both firms to provide the required documents on the volume of their businesses in the North African nation since the introduction of the VAT law, government sources told Enterprise.
It is worth noting that the authority had issued executive instructions this month showing that the smart mass transport service would be subject to a 13% retroactive VAT as of 8 September 2016 and a 14% of the value as of 1 July 2017.
The instructions issued by the authority in this regard were deemed as the value of the service provided, 20% of the fare’s value which the company obtains, while the driver's share was exempted from the tax.
Uber may be subject to a different tax from Careem, as it operates in Egypt as a foreign entity, unlike Careem, which operates in the country as an Egyptian company, sources noted.
The tax authority is projected to receive the required documents regarding the VAT from Careem this week.
Uber has promised to deliver the necessary documents after arrangements with its parent company and it will be subject to a different tax system than Careem in case of any tax agreement be inconsistent with the Egyptian regulations.
