The country’s tax affairs organization, by issuing a tax declaration form for Snapp, demanded the payment of VAT for this company since 2021.
According to Iran digital economy annotation, it seems that after this incident, the Snapp company protested its tax case in order not to be subject to value added tax, however, the Tax Dispute Resolution Board also voted for Snapp’s services to be subject to value added tax.
In the next step, the CEO of this company, while protesting this issue on social networks, informed the company and their protest to the Administrative Court of Justice.
After this incident, the public relations of the country’s tax affairs organization rejected the issues raised by this company and emphasized that according to the model of activities, the way of providing services and the obligations that Snapp has accepted towards drivers, it will be subject to value added tax.
Rejection of Snapp’s tax complaint in the Court of Administrative Justice
According to the decision of the 9th branch of the Court of Administrative Justice, which has been published in recent days, the Court of Administrative Justice has differentiated between transport service providers and platforms and emphasized that the transportation services are specific to the person in charge of the transportation and not the platforms.
In other words, there is no servant-servant working relationship between the relevant platforms and the drivers, and each of them provides their own independent service, and the transportation service itself is related to the transportation operator (drivers) and the intelligent services provided by The company is not considered a transportation service, so it will not be subject to VAT exemption.
The income of Snapp’s drivers is not subject to VAT
It should be noted that according to the decision of the Administrative Court of Justice as well as the opinion of the Tax Affairs Organization of the country, drivers’ fees are not subject to value added tax and only the fees received (commission) of Snapp are subject to value added tax. As a result, any increase in drivers’ expenses and reduction of their fees due to value added tax will not be accepted.
No Comment! Be the first one.