London taxi leaders press new Chancellor to exempt black cabs from incoming pay-per-mile tax charges for electric cabs
- Perry Richardson
- 9 minutes ago
- 2 min read
The Licensed Taxi Drivers’ Association (LTDA) has renewed its campaign to secure an exemption for London’s black cab trade from the Government’s planned pay-per-mile road charging scheme, with General Secretary Steve McNamara warning that recent political changes have forced the organisation to restart discussions with a new team of ministers.
Writing in the latest edition of TAXI, McNamara said the association had built a strong working relationship with former Chancellor Rachel Reeves and the Treasury before the ministerial reshuffle. He revealed Reeves had even referenced him by name during her Budget speech earlier this year, reflecting what he described as months of successful engagement with Government.
However, he said those efforts were disrupted when ministerial responsibilities changed, requiring the LTDA to begin making its case again. McNamara wrote: “As so often happens in politics, just at the moment you make some decent contacts with the right people, the wheel turns yet again and everything changes.”
The lobbying campaign centres on the Government’s proposed pay-per-mile charging system for electric and hybrid vehicles, due to begin in April 2028. Under current proposals, electric vehicles will pay 3p per mile, while plug-in hybrids will pay 1.5p per mile. The Treasury intends to calculate charges using annual mileage recorded through the MOT test.
McNamara argued that London taxis should receive a similar exemption to those already granted to vans. Although the TXE taxi is technically classified as a Range Extended Vehicle because it uses a petrol engine to recharge its battery, it is currently grouped alongside hybrid vehicles for Vehicle Excise Duty purposes.
The LTDA believes additional operating costs would ultimately be passed on to passengers through higher fares. McNamara said exempting licensed taxis would support the Government’s wider ambition of reducing costs while recognising the essential public transport role that black cabs play across the capital.
He also confirmed the association has already opened discussions with Chancellor John Healey and the Treasury in an attempt to secure equal treatment with other commercial vehicles. Alongside Government lobbying, the LTDA has approached Transport for London and the Mayor’s office seeking their backing for the exemption campaign.
Despite acknowledging the challenges involved, McNamara expressed cautious optimism. He wrote: “Whilst I’m not wildly optimistic, I am fairly confident we can at least get them to take a serious look at the options. Acknowledgement and honest discussion is key here.”
The campaign is likely to become an important issue for London’s taxi industry over the next two years as the implementation date approaches.
Given the impact to their income, cabbies will be watching closely to see whether ministers are prepared to recognise licensed taxis as a distinct category within the new road charging framework, potentially shielding the trade and its customers from additional operating costs as it continues its transition towards zero-emission capable vehicles.
