Taxing time for BRTA to check Uber ‘free run’ in Dhaka

Transport authorities are finding it a daunting task to formulate a proper identification policy and taxation structure for app-based taxi service Uber, which now operates without permission in Dhaka. A special committee set up by the Bangladesh Road Transport Authority (BRTA) to chalk out guidelines for making Uber service legal has so far met the company’s representatives in Dhaka three times, but to no avail, sources told The Independent.
The last meeting was held on February 22 at the BRTA office, and it was attended by a delegation from Uber India. However, like the previous two meetings, it too ended without any fruitful result, said sources present at the meeting.
The sources said the Uber representatives declined to disclose the number of vehicles using the company’s services in the capital, saying they were not legally obligated to disclose such information.
BRTA enforcement director Nazmul Ahsan Mazumder, who heads the special committee, told The Independent: “We are still in the dark over the number of vehicles providing Uber services. We asked them, but they didn’t disclose it.”
The BRTA director said that they were facing two main problems with Uber. “One is identification and the other one pertains to taxation,” he added.
Mazumder said since a large number of people was happy using this global taxi hailing app service, they wanted to legalise it. “As of now, the service is illegal as it cannot be regulated with any of the provisions under the existing Act.”
He clarified that BRTA had no problem with Uber’s operations, but the service has to be run with vehicles registered for commercial use, and not private ones.
“For commercial use, there are taxi services and these are regulated by the Taxicab Service Guideline, 2010.
Prospective companies must seek approval from the road transport and highways division via the BRTA. However, the case with Uber is not the same,” he said.
The BRTA official said there was no way of finding out whether a car was being used for Uber service. “The whole operation is conducted via mobile phones and the enforcement officials on the road cannot possibly check that,” he added.
In neighbouring India, the Delhi government had imposed a general ban on all app-based taxi services, including Uber, on December 8, 2014, after a 26-year-old female passenger was allegedly raped by her driver.
Following this, India’s ministry of road transport had issued guidelines for ride hailing services such as Uber (Uber Technologies Inc.) and Ola (ANI Technologies Pvt. Ltd), in October 2015, identifying them as on-demand information technology-based transportation aggregators and not as taxi companies.
India’s guidelines, however, were favourable to taxi-app operators like Uber in the sense that they recognized ride-sharing as a distinct type of transit service.
They also did not seek to impose taxi-style rules, for instance, requiring cars to display a visible meter for identification.
In Canada, Uber-run vehicles fall under the category of private transportation company (PTC). As per these guidelines, vehicles have to display a sticker on the back window of the passenger side while operating in a PTC capacity.
Imposition of a unique identity for Uber-run vehicles, however, depends on individual government regulations across the world. Most of the countries do not impose any specific identification for Uber vehicles.
Mahbubur Rahman, a Bangladeshi student who drives for Uber part time in Charleston in North Carolina in the US, told The Independent that identification was needed for Uber so that it could be regulated, and more importantly to bring it under the taxation structure.
“In Charleston, if you’re an Uber driver, you’ll need to declare the income you’ve generated in the financial year on your tax returns. But in many US states, the tax is not paid by the driver, but Uber cuts a portion from fares as taxes,” he added.
Rahman, who hails from Dhaka, said that in a country like Bangladesh, which only has around two million taxpayers out of a population of 160 million, formulation of proper taxation is important.
BRTA director Mazumder too admitted that finding a proper taxation structure for Uber has become their main headache now. “We have already asked the National Board of Revenue (NBR) to assist us in this matter,” he said.
Interestingly, Uber now operates in 581 cities in 81 countries across the world, but this multi-billion dollar company does not have any fixed policy to share revenue with the government in the form of taxes.
US-based Fortune magazine reported that Uber declined to make any of its executives available to discuss its corporate structure or its approach to tax planning when it was filing a report on the loopholes of the app-based taxi service’s taxation structure.
The company also declined to respond on the record to questions about the details of its tax minimisation efforts.
This correspondent tried to talk with the representatives from Uber office in Dhaka, but all of them refused to talk.
One employee said the communications of Uber in Dhaka were handled by Ruchita Tomar, head of communication of Uber India, as the Indian office looked after the company’s South Asian operations. The Independent contacted Ruchita Tomar over phone and sent her a questionnaire. But she never replied.

Taxing time for BRTA to check Uber free run in Dhaka

Transport authorities are finding it a daunting task to formulate a proper identification policy and taxation structure for app-based taxi service Uber, which now operates without permission in Dhaka. A special committee set up by the Bangladesh Road Transport Authority (BRTA) to chalk out guidelines for making Uber service legal has so far met the companys representatives in Dhaka three times, but to no avail, sources told The Independent. The last meeting was held on February 22 at the BRTA office, and it was attended by a delegation from Uber India. However, like the previous two meetings, it too ended without any fruitful result, said sources present at the meeting. The sources said the Uber representatives declined to disclose the number of vehicles using the companys services in the capital, saying they were not legally obligated to disclose such information. BRTA enforcement director Nazmul Ahsan Mazumder, who heads the special committee, told The Independent: We are still in the dark over the number of vehicles providing Uber services. We asked them, but they didnt disclose it. The BRTA director said that they were facing two main problems with Uber. One is identification and the other one pertains to taxation, he added. Mazumder said since a large number of people was happy using this global taxi hailing app service, they wanted to legalise it. As of now, the service is illegal as it cannot be regulated with any of the provisions under the existing Act. He clarified that BRTA had no problem with Ubers operations, but the service has to be run with vehicles registered for commercial use, and not private ones. For commercial use, there are taxi services and these are regulated by the Taxicab Service Guideline, 2010. Prospective companies must seek approval from the road transport and highways division via the BRTA. However, the case with Uber is not the same, he said. The BRTA official said there was no way of finding out whether a car was being used for Uber service. The whole operation is conducted via mobile phones and the enforcement officials on the road cannot possibly check that, he added. In neighbouring India, the Delhi government had imposed a general ban on all app-based taxi services, including Uber, on December 8, 2014, after a 26-year-old female passenger was allegedly raped by her driver. Following this, Indias ministry of road transport had issued guidelines for ride hailing services such as Uber (Uber Technologies Inc.) and Ola (ANI Technologies Pvt. Ltd), in October 2015, identifying them as on-demand information technology-based transportation aggregators and not as taxi companies. Indias guidelines, however, were favourable to taxi-app operators like Uber in the sense that they recognized ride-sharing as a distinct type of transit service. They also did not seek to impose taxi-style rules, for instance, requiring cars to display a visible meter for identification. In Canada, Uber-run vehicles fall under the category of private transportation company (PTC). As per these guidelines, vehicles have to display a sticker on the back window of the passenger side while operating in a PTC capacity. Imposition of a unique identity for Uber-run vehicles, however, depends on individual government regulations across the world. Most of the countries do not impose any specific identification for Uber vehicles. Mahbubur Rahman, a Bangladeshi student who drives for Uber part time in Charleston in North Carolina in the US, told The Independent that identification was needed for Uber so that it could be regulated, and more importantly to bring it under the taxation structure. In Charleston, if youre an Uber driver, youll need to declare the income youve generated in the financial year on your tax returns. But in many US states, the tax is not paid by the driver, but Uber cuts a portion from fares as taxes, he added. Rahman, who hails from Dhaka, said that in a country like Bangladesh, which only has around two million taxpayers out of a population of 160 million, formulation of proper taxation is important. BRTA director Mazumder too admitted that finding a proper taxation structure for Uber has become their main headache now. We have already asked the National Board of Revenue (NBR) to assist us in this matter, he said. Interestingly, Uber now operates in 581 cities in 81 countries across the world, but this multi-billion dollar company does not have any fixed policy to share revenue with the government in the form of taxes. US-based Fortune magazine reported that Uber declined to make any of its executives available to discuss its corporate structure or its approach to tax planning when it was filing a report on the loopholes of the app-based taxi services taxation structure. The company also declined to respond on the record to questions about the details of its tax minimisation efforts. This correspondent tried to talk with the representatives from Uber office in Dhaka, but all of them refused to talk. One employee said the communications of Uber in Dhaka were handled by Ruchita Tomar, head of communication of Uber India, as the Indian office looked after the companys South Asian operations. The Independent contacted Ruchita Tomar over phone and sent her a questionnaire. But she never replied.