The Stop The Taxi Tax coalition is calling on the government to step in urgently and stop 20 per cent VAT being charged on private hire and minicab journeys.
HMRC has interpreted recent rulings in the courts as meaning that all taxi fares need to have VAT added on. But bringing in yet another tax is a terrible idea in the middle of a cost living crisis.
This tax will hit many different groups in society, including the most vulnerable:
- People who rely on taxis for essential journeys like trips to hospital – last year, over half a million people relied on private taxis (Ubers) to get to hospital appointments
- Older people for whom taxis are a lifeline to see their friends and family – 75% of over 65s oppose the tax (YouGov, Nov 2023)
- Those who live in rural areas and cannot always rely on public transport to get around – 62% of Brits believe this move will hit those in areas with inadequate public transport hardest (YouGov, Nov 2023). Around a quarter of journeys in the UK start in the most deprived neighbourhoods, which increases in regions outside of London – including 43% in the North West and 42% in the West Midlands.
- Women trying to get home safely in the evenings – 71% of women are against the proposed tax. One in five women (19%) who said they would stop taking taxis if prices went up, expressed concerns about their safety (YouGov, 2023). 10 million people (50% of which were women) used taxis to get home safely last year
- Businesses who work in the night-time economy and depend on the taxi trade for custom. 16.2 million people took taxi trips (Ubers) to a restaurant or bar last year, unlocking £686 million of activity in the night time economy
- Small minicab operators and drivers trying to make a living. Over a third of Brits say they would be less likely to use taxi services if the tax was implemented (YouGov). For an industry already struggling to recover post-COVID, this would put the earnings of to 200,000 drivers at risk
New research shows the British public agree, with 7 out of 10 opposed to 20% VAT being imposed on private hire and minicab journeys. This opposition was highest among low-income households (71%), women (71%), over 65s (75%) and those suffering from mobility impairments (74%) (Source: YouGov, 2 November 2023).
Low-income households and vulnerable groups are those who say they can least afford the new tax. Almost 8 in 10 low-income households who use pre-booked private hire taxi or minicab services (78%) say they will find it hard to pay higher prices, alongside 68% of those users with mobility impairments.
That is why the Stop the Taxi coalition has been formed: an alliance of taxi operators and other third parties who will be hit by this new tax. We call on the Government to step in and stop this tax at the earliest possible opportunity.
Further Proof Points
· In a period of soaring living costs, the public are frustrated by tax levels and only 14 per cent think the Government has got the balance of taxation right (Source YouGov poll on taxation, 16 October 2023).
· Tax is currently at the highest level since records began 70 years ago (IFS Report, 2023).
· Many areas with poor access to public transport already have less than 1 licensed vehicle per 1,000 people and are likely to be left with no service at all if smaller operators are forced to close.
Call to action
We urge all those opposed to this new tax to join the Stop The Taxi Tax Campaign. Together we need to show the Government why this new tax from HMRC must be stopped. To join the campaign and pledge your support, please click here and sign the form.
We kindly ask that you include the ‘sign up’ link above in all materials you share with your networks or the general public about the campaign. When doing so, we recommend that you make sure the link is prominently featured and clearly identifies itself as a means to pledge support. By encouraging others to sign up, we can build grassroot support and ensure our ask of the government gathers momentum.