Financial concerns ranging from Plug-in Taxi Grant future, insurance options dwindling and taxi VAT exemption rejected
The future of the Taxi Plug-in Grant (PiTG) is once again in question as the industry awaits a decision on its continuation beyond April 2025. The scheme, which was initially set to be scrapped last year, saw a temporary reprieve when the grant was reduced from £7,500 to £6,000 rather than being removed entirely. However, its fate now hangs in the balance.
Paul Brennan, Chairman of the Licensed Taxi Drivers’ Association (LTDA), has highlighted the growing concerns among drivers over the financial barriers to upgrading vehicles. With the PiTG playing a crucial role in making electric taxis more affordable, any reduction or removal of the grant could slow the transition to greener fleets.
Adding to the financial strain is the recent decision by Plan Insurance to withdraw from the taxi insurance market. The company, which has been a key provider of policies for taxi drivers, has now stepped away from the industry, leaving cabbies with fewer options at a time when securing affordable insurance is already difficult.
The industry also faced another setback when the Government confirmed just before Christmas that it would not be removing VAT on wheelchair-accessible taxis. This decision means costs remain high for drivers who must comply with accessibility regulations while managing rising expenses.
Paul Brennan, Chairman of Licensed Taxi Drivers’ Association (LTDA), said in TAXI Newspaper: “The Taxi Plug-in Grant had a reprieve last year when it went from £7.5k to £6k rather than being scrapped altogether but it was only a one-year reprieve and a further decision on it continuing past April 2025 is now due.
“We also need to continue looking for alternative taxi finance deals and insurance deals so drivers can firstly afford to stay in the trade and then have the ability to upgrade their taxi. Plan Insurance announcing they will no longer be offering taxi insurance has made that task even harder. That announcement along with the Government also announcing just before Christmas that they will not be removing VAT on wheelchair accessible taxis, was a double blow to the festive season.”
