The Hanoi Taxi Association is seeking to provide ride-hailing services for under 9-seater cars to enjoy tax benefits.
Ho Quoc Phi, general secretary of the association, has petitioned Hanoi authorities for permission, saying traditional taxi firms in the city have already been offering apps to book rides and meet all the requirements to offer ride-hailing services.
The association, which represents 16 taxi firms operating in Hanoi, said that Grab and similar companies registered as ride-hailing businesses enjoy many tax incentives denied to traditional taxi firms.
Grab pays a 2 percent corporate income tax on revenue, while taxi firms pay the tax of up to 25 percent on profit.
For taxi firms that have been operating with both the traditional model and the ride-hailing model, Phi has asked for refunds of the differences in taxes paid by ride-hailing firms and the traditional taxi firms.
Faced with strong competition from ride-hailing firms like Grab, some local taxi firms have joined forces to compete as one brand, while others have focused on developing their own mobile apps.
The ride-hailing market in Vietnam is bustling with the expansion of Grab and the entry of local firms like FastGo and Be, and Indonesia’s Go-Jek’s affiliate Go-Viet.
Vietnam’s ride-hailing and food delivery market will be worth $2 billion in 2025, according to a report released last year by Google and Singapore investment firm Temasek.