Uber India, which was recently under RBI attack for its payment collection process has mentioned that the company is not liable to pay service tax. Instead, Uber’s drivers will have to pay service tax and the company has agreed to give driver information / details to the tax authorities.
“They have submitted that liability to pay service tax lay with cab drivers. They have agreed to provide information about their cab members,” said a department official in Mumbai privy to the development. [source]
The tax authority will now have to go after registered Uber drivers to collect tax (we hope they are taking Uber cabs for these – as it will ease the collection :)).
Recently, tax authorities also asked why Facebook and Google are not paying taxes in India. The answer probably lies within the complex tax structure and outdated policies of the government.