Ride-hailing app Uber will finally pay the Value Added Tax (VAT) in Egypt, fulfilling Law No. 67/2016, Minister of Finance Mohamed Maait announced Monday.
Maait explained this step comes in order to resolve conflicts between white taxis and Uber, marking a step towards pushing Egypt’s national economy forward.
A week ago, Uber notified their users in a statement that fare prices would increase due to the VAT.
In an agreement with the Uber Country Director, the Tax Authority will facilitate collecting added value taxes from Uber, assuring that all the company’s tax conflicts would be sorted.
The VAT would also apply to other ride apps such as Careem, the Egyptian Tax Authority stated.
The Egyptian market is regarded as one of the most important hubs for Uber in the Middle East. Uber has invested $100 million into a customer service center in Egypt, guaranteeing some of the highest-quality service in Africa and the Middle East.
Abdel Azim Hussein Head of the Tax Authority, said in an interview with MENA that these agreements enhance cooperation between the tax community and all ride-hailing companies operating in Egypt.
The law was enforced on Uber and Careem last summer as a result of growing tensions between the ride-hailing companies and white Taxi drivers. White taxi drivers had begun to sue the ride-hailing companies, complaining that they were exempted from paying taxes for working on private cars.
Hazem Ghorab, head of the Institutional Communication Department at Careem confirmed the company’s full commitment regarding paying all taxes since March 2018, Dotmasr reported, clarifying that the company is in no need to make a new agreement with the Tax Authority.