Ola, Uber to face probe over alleged GST evasion

A probe has been initiated against cab aggregators Uber and Ola over evasion of GST by the Director-General of Goods and Services Tax Intelligence (DGGI) and has issued summons to the officials of the companies.

Official sources said that the tax liability of Uber India stands around Rs 800 crore, while that of Ola Cabs is around Rs 300 crore. The probe by the GST intelligence arm found that both the cab aggregators have not paid GST on the incentives paid to the drivers and also on the charges levied from customers for cancellation of rides.

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This tax is reportedly calculated at the rate of 15%, which companies have not paid over many years.

Commenting on the development, an Uber spokesperson said, “Uber is a law-abiding and compliant company. We are working closely with the authorities on all tax-related queries and will respond accordingly.”

Ola too confirmed that it received a notice from the tax department relating to certain matters prior to 2017 in its mobility business. “These pertain to the erstwhile service tax regime. We have been actively engaged with the department and are cooperating with the tax authorities and are confident that we will be able to resolve this satisfactorily. Ola is a proud taxpayer, and we comply with all our tax obligations and have contributed several thousand crores in taxes over the last 4 years alone,” a company spokesperson said.

An investigation into Ola and Uber comes close on the heels of the I-T department conducting searches on various companies including Swiggy, Instakart, Zee Entertainment Enterprises and Larsen & Toubro for a fake input tax credit.