According to a representative from Uber, beginning on June 1, the monthly value-added tax (VAT) withholding rate will be set at 8% and the income tax rate will range from 3% to 9%.
Uber responded with a statement, saying
“With this new scheme, Uber will be able to calculate, withhold and pay directly to the Mexican tax authorities the amount of income tax and VAT that its drivers and delivery drivers owe every month” (Reuters
This new program won’t change drivers’ employment status, which has historically been a key issue for Uber due to the fact that Mexican law allows for retention of taxes without an employment relationship. Historically, drivers have had to declare their own taxes in Mexico.
According to the Mexican Finance Ministry
, other companies that have agreed to the new tax program include Cabify, Bolt, Beat, Cornershop, Rappi, SinDelantal and Uber Eats.
Chinese ride-hailing giant Didi was expected to participate in the program, but withdrew last week.
The company announced that it would not join the voluntary program but would consider participating in the future once they fully understand the implications this measure will have for its drivers. Didi expressed that their operations are in “full compliance” with current regulations in Mexico.