Veezu has joined 58 other private hire operators in calling on Chancellor Rachel Reeves to confirm that private hire journeys will not be subject to a 20% VAT rate in the Autumn Budget.
The measure, referred to across the industry as the “Taxi Tax”, is expected to be addressed on 26 November. Operators warn that applying a blanket VAT rate of at least 20% on all private hire vehicle (PHV) fares would increase costs for millions of passengers, reduce the number of driver-partners in the sector, and threaten the future of hundreds of small and medium-sized British-founded operators across the UK. The letter also cautions that the proposal could damage local economies, particularly the night-time economy, which depends on affordable and accessible transport.
The operators also claim that the “Taxi Tax” will also hit working families and residents outside major cities, particularly in Wales, the South West and the East of England, which have far fewer accessible transport options. Within Cardiff-headquartered Veezu’s own network, more than 50% of journeys are for essential purposes such as healthcare, commuting and education, while only 12% are for leisure. Any increase in fares would disproportionately impact households that rely on PHVs for everyday mobility, the firm says.
Nathan Bowles, CEO of Veezu, said:
“PHVs keep Britain moving, connecting communities that rely on us for essential journeys, and a 20% VAT hike would hit the elderly, disabled, and rural passengers hardest. The open letter is a united call from operators across the UK urging the Government to confirm that PHVs will not be subject to a 20% VAT rate. Businesses cannot plan, invest or grow while uncertainty remains, and every month without reassurance contributes to the slow erosion of one of Britain’s most essential transport services.
“A clear, consistent policy would protect passengers and licensed drivers from rising costs, back British businesses, and restore confidence in a sector millions depend on for everyday travel and essential journeys.”
