Taxi industry needs more ‘financial incentives’ this Spring Budget or risks losing more drivers, says The Taxi Insurer
Updated: 2 days ago
The taxi industry needs more ‘financial incentives’ this Spring Budget or it may risk losing more drivers, says The Taxi Insurer.
Since its launch in 2018, the Plug-in Taxi Grant (PiTG) has helped thousands of taxi drivers move to ultra-low emission vehicles. The scheme has been credited with playing a key role in lowering emissions from the taxi fleet and backing the Government’s broader clean air goals.
The Department for Transport recently announced that the PiTG will remain in place for another year, but at a reduced rate. This latest cut follows a reduction earlier in 2024, when the grant fell from £7,500 to £6,000. The new £4,000 rate will apply from 6 April 2025 to 5 April 2026.
Dave Sweeney, Senior Operations Manager at The Taxi Insurer, said the latest cut may weaken interest in ULEVs. He warned that fewer financial incentives could lead to lower adoption and potentially push more drivers out of the trade.
Ahead of the Spring Budget this week, Sweeney said further government support was needed, suggesting options like tax-free loans to help cover higher upfront vehicle costs. Without that, he cautioned, uptake could continue to fall short of targets.
Sweeney said: “Since its introduction in 2018, the Plug-in Taxi Grant has allowed more than 9,000 taxi drivers to invest in ultra-low emission vehicles (ULEVs), supporting the transition to greener urban transport.
“However, the recent reduction in the grant from £6,000 to £4,000 per vehicle is concerning. Following a similar decrease from £7,500 to £6,000, in 2024, the latest reduction is unlikely to encourage enough taxi drivers to make the desired switch.
“Without additional financial incentives, such as tax-free loans, adoption rates could slow and more drivers could leave the industry. We’d therefore welcome proactive action from the government to address this issue and provide meaningful support for the taxi sector."
