Sheffield taxi fares set for fuel-linked hikes as council weighs surcharge of up to £2 per journey

Sheffield City Council is being asked to approve a temporary fuel surcharge for hackney carriage journeys, with charges linked directly to diesel prices and reviewed monthly.

Sheffield City Council is set to consider reintroducing a temporary fuel surcharge for hackney carriage fares following requests from trade representatives and licence holders who say rising operating costs, particularly higher diesel prices, are placing increasing pressure on drivers.

A report due before the Environmental Services and Regulation Policy Committee on 19 June recommends introducing a variable surcharge that would be added to taxi fares when average diesel prices exceed specified thresholds. The proposal comes less than three years after a similar temporary fuel surcharge was introduced during the fuel price volatility of 2022 before being removed as part of a wider fare review in 2023.    

Under the latest proposal, passengers would pay an additional 20p per journey when average diesel prices exceed 165 pence per litre. The surcharge would increase in stages, reaching a maximum of £2.00 when diesel prices exceed 210 pence per litre.

The council is proposing to review diesel prices monthly using data published by the Department for Energy Security and Net Zero. Any surcharge adjustments would be based on average diesel prices recorded during the final two weeks of the previous month, allowing the charge to rise or fall in line with fuel market conditions.

To accommodate the fuel surcharge within the existing fare structure, officers are also proposing the removal of the current £2 additional charge applied to journeys carrying between five and eight passengers.

If approved, drivers would be required to apply the surcharge through their taximeters at the end of each journey. The charge would also be displayed on vehicle fare cards to ensure passengers are informed before travelling.

Council officers said they had reviewed evidence submitted by the trade alongside comparisons with other licensing authorities and wider economic conditions. Representatives from the Sheffield Taxi Trade Association and Unite the Union have since indicated support for the temporary surcharge, while agreeing that a full review of hackney carriage fares should be postponed until later in 2026.

Rather than implementing a permanent fare increase immediately, licensing officers argue that a variable surcharge provides a more flexible response to fluctuating fuel costs. The report states that a wider review later this year will allow the council to examine the overall fare structure and assess whether the surcharge remains appropriate.