Uber Ensures Local Partners in Indonesia Pay Taxes in Full

We recently met Alan Jiang and Karun Arya from Uber and talk about the development of this smartphone-based private car rental service in Indonesia. Alan is a member of the International Launcher team and currently leads the Uber Indonesia team, up to General Manager for Jakarta office successfully recruited. Uber itself just acquired latest funding of $1,2 billion, with the largest portion allocated for expansion in the Asia Pacific region.

According to Alan, their current target is to serve consumers throughout Jakarta with a waiting period of less than 10 minutes from ordering, although they do not give a specific deadline when this target can be achieved. Currently, they want consumers in the area around Senopati (and SBCD) to be reached by the Uber fleet with a waiting time of about 10 minutes and the Kuningan and Kemang areas within 15 minutes.

Regarding the possibility of expanding to other cities in Indonesia, Alan said that after they succeeded in meeting their target in Jakarta, they did not rule out this in the future. Alan added that currently they still only provide UberBlack service, even though they had time experiment with UberLUX a month ago.

When asked about pricing arises that have been tested two months ago, Alan said Uber would enforce pricing arises permanently (during peak hours) if you already have a lot of satisfied customers with Uber services in Jakarta. As long as the number of vehicles is still not sufficient, to accommodate all consumers, it should be pricing arises has not been applied regularly.

Meanwhile, even though in the United States Uber cooperates with PayPal and in China with Alipay, Uber will not provide an alternative payment method for consumers in Jakarta in the near future to complete a credit card. In Indonesia, credit card penetration is still limited. Data from the Indonesian Credit Card Association (AKKI) shows that the number of credit cards in Indonesia is almost 16 million, or about 6% of the total population, although we do not have data on how many are domiciled around Jakarta.

Regarding the issue of regulatory compliance and taxation, Alan said Uber works closely with regulators and all taxes are paid in full by its local partners. Karun added that Uber brings accountability and transparency to the transportation business. Before they came, taxi companies were usually still cash-based which was paid to taxi drivers. With an electronic payment system that is cashless, Uber ensures all revenue is recorded and Uber partners must pay taxes.