A 'taxi tax' would hit vulnerable passengers and struggling businesses hardest

"Policies like the taxi tax destroy the ecosystem in which the hospitality sector functions."

"These are the people who would be disproportionately hit."

"Drivers are self-employed entrepreneurs, and around 70% work outside London. A flat 20% VAT would inevitably raise costs for consumers and reduce demand, leading to a drop in driver earnings."

Rumours that VAT will be applied to all taxi journeys in the autumn Budget have prompted concern across multiple industries. Hospitality leaders warn that higher taxi fares would deter customers and make commuting harder for staff already coping with increased National Insurance and energy costs. A 1.2 percentage point NIC rise lowered the employer threshold from £9,100 to £5,000 and has been linked to nearly 89,000 hospitality job losses. Many taxi passengers are elderly, disabled or unable to use public transport and would be disproportionately affected. Operators are expected to raise fares to cover compliance, and drivers face reduced earnings.

Read at Business Matters