Social carpooling app operators say they are in compliance with Road Traffic (Car Pools) (Exemption) Order 2015. They highlight the differences between social carpooling and private cars for hire (Moonlighting or not? 'Social carpooling' still a grey area; Aug 31).

These differences include lower fares meant to only reimburse fuel costs and not to make a profit.

There is also no additional insurance or vocational licence needed, no requirement to set up an Accounting and Corporate Regulatory Authority entity, and a daily limit of two trips.

Social carpooling has been described as a "non-commercial" service. To laymen, a commercial service would mean it is taxable, so a non-commercial service must, therefore, be non-taxable.

A GrabHitch support reply to an income tax query was that "GrabHitch drivers do not need to declare their earnings for income tax filing. The fare collected from Hitching is meant to cover your fuel costs and, in the meantime, save on carbon footprint. It is not meant as a source of income and, as such, you do not need to declare the amount collected from GrabHitch".

With more than 50,000 GrabHitch drivers, the operator should clarify whether the service is taxable.

If it is, the operators of such services should be providing the same information to the Inland Revenue Authority of Singapore for taxation purposes.

If the current social carpooling service is taxable, but it is supposed to reduce carbon footprint, could the authorities consider making it non-taxable? Then this should not be deemed a source of income with moonlighting implications.

Alternatively, the fare paid to the drivers could be directed to the Land Transport Authority Cares Fund. Drivers who choose to put their fares into this fund may get tax relief, and the needy can tap the fund for fares.

Cho Hon Loon