Tax & Accounting Blog

Rough Ride for Uber in the Low Countries

Blog, Checkpoint Daily Newsstand, Featured, Indirect Tax, ONESOURCE, Reuters Business News, Reuters Tax & Accounting News, Sales and Use Tax October 6, 2015

The third quarter of 2015 was a tumultuous one in Belgium and the Netherlands for Uber Technologies, Inc.

The Netherlands

On September 29 2015, the Dutch Ministry of Infrastructure and the Environment’s Human Environment and Transport Inspectorate (Dutch:  Ministerie van Infrastructuur en Milieu, Inspectie Leefomgeving en Transport) announced that Uber offices in Amsterdam had been searched by the Intelligence and Investigation Service Inspectorate of Environment and Transport as part of a criminal investigation being led by the Amsterdam District Prosecutor and the Public Prosecution Service. Uber is accused of organised violations of the Passenger Transportation Act 2000 (Dutch: Wet personenvervoer 2000) with the UberPop service.

UberPop has been operating in Amsterdam since July of 2014, and was informed by the Minster of Infrastructure and the Environment in a September 29 2014 letter that the ministry intended to impose fines upon Uber for violation of Article 76 of the Passenger Transportation Act 2000. Paragraph 1 of Article 76 states “It is forbidden to transport by taxi without a license granted for this purpose by the Minister.” In May of 2015 the Ministry raised the fines from 10,000 Euro per violation to 50,000 Euro per violation, and raised the ceiling on fines from 100,00 Euro to 1,000,000 Euro after Uber paid the maximum of 100,000 Euro. Uber has received 450,000 Euros in penalties as of September 29, 2015.

Taxi services in the Netherlands are subject to the reduced VAT rate of 6%. Other services are generally subject to the Netherlands’ standard VAT rate of 21%. A report in the Dutch Newspaper Volkskrant regarding Uber and VAT OBLIGATIONS quotes an Uber spokesperson on the subject:

“We can not send an invoice with VAT because the UberPop riders pay no VAT. They are not registered with the Chamber of Commerce.”


On September 18 2015 an article in the Belgian newspaper De Morgen quoted Filip Nuytemans of Uber Belgium on Uber’s new plan in Belgium to monitor VAT registration numbers of UberPop and UberX drivers:

If it turns out that the driver is not in order, they are deactivated. For Uber X valid VAT numbers are required anyway.

This came as part of a larger plan by Uber to observe fiscal and social requirements in Uber’s Belgian operations. The announcement may have come too late, as it turns out. On September 24 2015 The Commercial Court in Brussels banned the UberPop service and gave the company 21 days to cease operations. After that time the company will face a 10,000 Euro/day fine up to 1,000,000 Euro. This follows a similar ban issue in April 2014 which has been ignored by Uber. Like the Netherlands, taxi services in Belgium are subject to the reduced VAT rate of 6%. Uber drivers in Belgium receive a weekly invoice from Uber for the Uber services they make use of, and these invoices are sent without VAT, but are designed so that the VAT obligations are pushed/shifted onto the driver, and Uber recommends a 21% VAT rate.


Meanwhile, the European Court of Justice in Luxembourg is in the process of determining whether the Uber app is a transport service or a digital service. At issue is whether the Uber app is a digital service, or a transport service. The case was referred to the court by a judge in Barcelona, and the outcome of the decision has licensing and VAT reporting implications.