‘TAXI TAX’: SNP motion condemns government plans for VAT on private hire vehicle fares that would ‘kill the taxi trade’
- Perry Richardson
- Sep 26
- 2 min read
An SNP motion has been lodged in the Scottish Parliament condemning reported plans by the UK Government to introduce 20% VAT on all taxi fares.
Kevin Stewart, MSP for Aberdeen Central, submitted the motion on 22 September, warning that the move would have damaging consequences for drivers and passengers.
The motion states that the measure would “kill the taxi trade” and have a serious impact on poorer, disabled and older people who rely on taxis for essential journeys. It adds that higher fares risk worsening poverty, social isolation and loneliness across communities.
Mr Stewart’s motion calls on the UK Government and Parliament to reject the proposal, which is expected to be set out in the Chancellor’s Autumn Budget.
Concerns around VAT on fares have grown in recent weeks, with trade unions and local representatives warning that drivers could be pushed out of work and passengers priced out of vital services. Many in the industry argue that the burden of the tax would fall hardest on vulnerable groups who already face barriers to accessible and affordable transport.
The Chancellor is widely reported to be considering extending VAT to cover all private hire and taxi journeys, replacing the current system where most operators outside London do not charge VAT on the full fare. The change could see fares rise sharply across the UK if introduced.
The Scottish motion adds political pressure on Westminster as the industry waits for confirmation in the Autumn Budget.
Stewart MSP said on social media: “The UK Labour Government is planning to impose the standard VAT rate on all taxi fares, which will hit lower-income, disabled and older people hardest.
“I have called on the Labour Chancellor to ditch this daft proposal.”
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