The launch of the driver-owned, subscription-based ride-hailing platform Bharat Taxi has triggered fresh discussions on tax policy clarity, with driver groups urging the government to differentiate between SaaS-based mobility platforms and traditional commission-driven aggregators. Designed as a cooperative model, Bharat Taxi aims to provide auto and cab drivers greater control over pricing and earnings through a fixed membership subscription rather than trip-based commissions.
The debate centres on the proposed 5 percent GST on ride fares under the subscription or SaaS model. Unlike conventional e-commerce aggregators that control pricing and collect payments, SaaS platforms merely provide digital access while fares are negotiated and collected directly by drivers. Industry stakeholders argue that applying GST in such cases contradicts Section 9(5) of the GST Act, which assigns tax liability to operators only when they manage the supply and payments.
Driver unions have raised concerns that imposing GST on individual rides could significantly reduce incomes, particularly as many drivers earn below the GST registration threshold. “Imposing GST on every ride will directly reduce drivers’ daily earnings,” said Zahir Hussain, President of the Tamil Nadu Auto Call Taxi Drivers Union Federation. In Kolkata, where thousands of drivers are exploring cooperative platforms to reduce commission costs, stakeholders say tax clarity will determine the pace of adoption. Supportive GST treatment could accelerate the shift toward driver-owned mobility platforms across eastern India.