No date yet for VAT decision on private hire vehicles says Exchequer Secretary as industry waits for clarity
- Perry Richardson
- Jul 21
- 2 min read
Updated: Jul 29
The Government has yet to confirm when it will respond to a consultation on the VAT treatment of private hire vehicles, despite the process closing in August 2024.
Gareth Bacon, Shadow Secretary of State for Transport, raised questions in Parliament about the timetable for a response. He also asked the Treasury what assessment has been made of the potential impact of applying VAT to private hire journeys outside London.
In reply, Exchequer Secretary James Murray stated that services provided by VAT-registered private hire operators have always been subject to VAT. He noted that the Government continues to take the issue seriously and acknowledged the sector’s need for clarity.
However, Murray added that decisions on tax policy must be made during fiscal events, taking wider public finances into account. No firm date was given, but he said the Government would publish a response to the consultation “soon”.
The delay leaves operators and drivers outside the capital uncertain about future tax obligations. Industry bodies have previously warned that new VAT requirements could affect fares, earnings and viability in many regions.
Murray said: “Private hire vehicle services provided by VAT-registered businesses are, and always have been, subject to VAT. The Government continues to take the issue of VAT treatment of private hire vehicle services seriously and recognises the importance of clarity to the sector. It is right, however, that decisions on tax policy are taken at fiscal events in the context of overall public finances. The Government will therefore publish a response to the consultation soon.”
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